NEW DELHI: The petroleum ministry and state oil firms plan to raise diesel and petrol prices next month as crude oil rose to a three-month high last week and diesel consumption has soared because of the weak monsoon and poor power supply, government and industry officials said. State oil firms are putting pressure on the ministry to act, particularly after Indian Oil Corp recently reported the highest-ever quarterly loss by an Indian company. Total quarterly loss of state refiners exceeded 40,000 crore.
Diesel is expected to be costly by 4-5 a litre and petrol rates could be raised by 3 a litre, officials said. "Price hike is inevitable, but the timing and quantum of hike would be politically decided after the monsoon session," an official said, requesting anonymity. The monsoon session of Parliament will end on September 7.
The government may spare kerosene but raise cooking gas prices between 50 and 100 and restrict the number of cylinders per household in a year to minimize revenue loss on fuels, which is estimated over 165,000 crore for current fiscal year, the official said. Rates of diesel, cooking gas and kerosene have been frozen for about 14 months.
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