Despite a record high of over $145 a barrel in the prices of global crude oil, consumers of petrol, diesel, LPG and Kerosene need not panic as there is going to be no hike in domestic fuel prices till October.
A review of the crude oil situation will now be carried out only in October and there will be no price hike till then, petroleum secretary M S Srinivasan was quoted from Madrid.
?At the June Cabinet meeting that decided to raise petrol, diesel and domestic LPG prices, it was agreed that we will take stock of the situation in October. By that time he said the government will also get a clear picture of the dent that high international crude prices will leave on revenues of state-run oil retailing firms in the first half of FY?09,? Srinivasan said.
Notwithstanding this, the government in any case is left with limited options to deal with the ongoing fuel crisis, where crude oil prices have crossed $145 a barrel and are inching towards the $150 a barrel mark.
A senior petroleum ministry official confirmed that after the recent record hike in domestic fuel prices by Rs 5 a litre for petrol, Rs 3 for diesel and Rs 50 per cylinder for LPG, there is virtually no possibility of another domestic fuel price hike immediately.
?Duties, both customs and excise, have already been slashed and there is a very limited possibility of the duties being tweaked further. Therefore, the only option that is being talked about in the current high oil price regime is to issue oil bonds to the PSU oil marketing companies,? the official said.
The last hike in petroleum product prices together with cut in customs and excise duties had only marginally offset the Rs 2,45,000 crore projected revenue loss at that time. Despite the hike and duty cuts, Indian Oil, Bharat Petroleum and Hindustan Petroleum are currently losing Rs 14.92 a litre on petrol, Rs 24.90 on diesel, Rs 38.098 on a of kerosene and Rs 338.53 per 14.2-kg domestic LPG cylinder. IOC, the largest retailer, alone is losing Rs 383 crore per day on fuel sales. At present prices, the total revenue loss of the three firms projected now for 2008-09 stands at Rs 211,400 crore.