The public sector oil marketing companies have raised petrol prices by `2.50 to `2.54 per litre from Saturday midnight due to a surge in international crude prices. These firms have also hiked aviation turbine fuel (ATF) rates by two per cent.
Indian Oil Corporation, which has the highest number of petrol pumps in the country, has raised petrol prices by `2.50 per litre in Delhi. Of the other PSU oil marketing companies, HPCL will hike petrol prices by `2.54 per litre and BPCL by `2.52 per litre, sources said.
These PSU oil marketing companies have avoided a uniform hike in order to avoid allegations that they have formed a cartel and were killing competition in the market. Since petrol prices were decontrolled in June 2010, its price has been hiked by around `7 per litre. Last month, these firms had raised petrol prices by `2.94-2.96 per litre. The latest increase in petrol prices is bound to further increase inflation, which stood at 8.43 per cent in December.
“But the hike was necessitated due to the oil companies’ mounting losses as international crude prices jumped to $92 per barrel,” said a senior oil PSU official. The government has already deferred any move to decontrol diesel prices as food prices remain uniformly high across the country. An Empowered Group of Ministers headed by finance minister Pranab Mukherjee put off its meeting last month on diesel deregulation. Any increase in diesel prices would have a direct bearing on the prices of foodstuff and other essential commodities due to increase in transportation costs.
The PSU oil companies are losing `7 per litre on sale of diesel at lower than the market rate. In December, these three PSU giants were losing `275 crores in revenue per day on selling diesel, domestic LPG and kerosene at subsidised rates. Mr Mukherjee has said the government will support the oil companies through a subsidy-sharing arrangement.
The BJP has, meanwhile, demanded a rollback of the hike in petrol prices, saying seven hikes in six months was totally unjustified and amounted to “looting” the common man. “This hike is totally unjustified. This is nothing but loot of the common man by the government. A product which costs `30 is being sold at `60, which is 100 per cent taxation. We call for its rollback,” said BJP spokesperson Prakash Javadekar.