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Saturday, March 31, 2012

india petrol prices will rise for april 2012

india petrol prices will rise for april 2012 ; State-run oil marketing companies plan to raise petrol prices by Rs 5 a litre from next month after they get an informal nod from the oil ministry, industry and government officials said. The decision is likely to be taken on Saturday when oil firms meet for a fuel price review.

"We are incurring a loss (revenue) of about Rs 7 per litre on petrol. We have to raise its price by at least Rs 5. But the government owns the companies so we have to wait for its green signal," said a senior executive of a state-run refinery. Government officials, however, said oil companies might not be allowed to raise petrol prices considering the volatile political situation during the Budget session of Parliament.

The UPA government, which depends on support from diverse political parties, can't risk the passage of the Finance Bill. It can bite the bullet after the Bill is passed in May," said an official requesting anonymity.

Oil-marketing companies Indian Oil, Hindustan Petroleum and Bharat Petroleum have been demanding that the government either allows them to raise petrol prices or compensates them for revenue losses on the de-controlled fuel.

Petrol prices were freed from government control in June 2010, but state oil firms do not raise fuel prices without the tacit approval of the oil ministry. The prices of diesel, kerosene and cooking gas are still regulated.

Oil firms, which are seeking Rs 5,000 crore as compensation for revenue losses on petrol, have not been able to raise prices since December owing to the assembly elections in five states and the Budget session of Parliament, which went on recess from Friday for three weeks.

IOC, country's biggest fuel retailer with about 50% market share by volume, had said last week that oil firms would take a call on petrol price hike by end-March, when they close their accounts for the financial year 2011-12.

"We have asked the government to compensate us for petrol losses as well for the current financial year. We hope it will be considered," IOC chairman RS Butola had told reporters at the Asia Gas Partnership Summit last week.

Oil firms are losing Rs 13.10 a litre on diesel, Rs 28.67 a litre on kerosene and Rs 439.50 a cylinder on cooking gas for selling fuels below market rates. Although international crude oil prices have dropped by about $2.5 a barrel, from about $125 a couple of days ago, the gains have been offset by depreciation in the rupee.

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