Govt may consider cut in petrol prices
September 5th, 2008 | by admin |Rating: 0
Global oil prices may have fallen USD 35 a barrel in past few weeks but consumers in India will have to wait for the rates to fall further for a fuel price cut as even at current levels, oil firms are losing huge money.
“We will consider a price reduction (when) international oil prices fall further,” Petroleum Minister Murli Deora said in New Delhi.
State-run Indian Oil, Hindustan Petroleum and Bharat Petroleum are still losing about Rs 400 crore per day on sale of petrol, diesel, domestic LPG and kerosene despite oil coming off its peak of USD 147 per barrel to about USD 112.
Deora said the Government is considering dual-pricing for diesel. “Oil companies are projected to lose about Rs 100,000 crore on diesel sales this year as the subsidised fuel is being increasingly used in industries for power generation.”
The minister also asked why should people who travel in luxury cars be sold subsidised diesel.
State-run firms have proposed to the Petroleum Ministry that diesel for industries and big cars be sold at Rs 57 per litre instead of Rs 34.80 a litre being sold now at petrol pumps.
“We are considering dual pricing but it is very difficult to implement,” Deora said.
The Railways for one, which currently gets diesel at subsidised rates, may revolt if prices are raised. Also, monitoring petrol pumps that sell market-priced diesel to big cars will be difficult.
