EGoM to meet again to hike petrol prices
The empowered group of ministers (EGoM) on decontrol of fuel prices will meet on Friday to take a view on the issue of freeing petroleum prices from government control.
“There is a meeting on June 25 on fuel prices. I cannot say whether prices will be hiked,” said the petroleum minister, Mr Murli Deora.
The stocks of PSU oil marketing companies IOC, BPCL and HPCL were up by three to four per cent on Tuesday on the hope that the government may finally bite the bullet and decontrol fuel prices.
However, the government is facing stiff resistance from both the allies and opposition parties on any hike in the prices of petroleum products.
What has made the decision to decontrol fuel price more difficult for the government is that the inflation in May crossed double digits and any fuel price increase at this juncture will make the lives of people more difficult. But the petroleum ministry and the planning commission are reportedly pushing for the decontrol of fuel prices.
The first meeting of the EGoM which took place two weeks back had failed to reach any conclusion as a majority of members were absent. Since then the petroleum ministry has been trying to hold the second meeting of the EGoM to reach to a decision.
In order to lower the impact of the fuel price hike, Mr Deora had written to the chief ministers asking them to lower the VAT imposed on the petroleum products.
Petrol price will go up Rs 3.73 a litre if the domestic prices are aligned with international rates. This is because currently domestic retail prices are benchmarked at close to $60 per barrel crude oil price while the global rates currently are over $ 77 per barrel.
The Kirit Parikh committee on the fuel pricing had in its report recommended freeing of petrol and diesel prices and a hike of Rs 100 in LPG and Rs 6 per litre in kerosene.
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