Petrol prices hiked again

Shares of public sector oil marketing companies rose on Friday after they hiked petrol prices by Rs 1.82 per litre. Following the latest increase, petrol will cost Rs 68.64 per litre in Delhi, up from Rs 66.64 a litre. The retail selling price in different cities will vary according to local taxes. This is the second hike in petrol prices in less than two months. The OMCs had earlier increased petrol prices by Rs 3.14 a litre on September 16.

On Tuesday, HPCL Finance Director B Mukherjee said that the company was losing Rs 1.50 a litre on petrol. As on November 1, the OMCs are losing Rs. 9.27 a litre on diesel, Rs. 26.94 a litre on kerosene, and Rs. 260.50 on LPG cylinder.



Meanwhile, Union Petroleum Minister S. Jaipal Reddy wants the Group of Ministers (GoM) on fuel prices to review the rates of subsidised fuels (diesel, LPG and kerosene) before the start of the winter session of parliament. The session is likely to be on Nov. 22.

The under-recoveries of OMCs are expected to be around Rs. 1.3 trillion in the current fiscal year ending on March 31, 2012. Reddy said that the financial capacity of the oil retailers should not be overestimated. He however, agreed that the decision on pricing may not be easy.

Although petrol prices were deregulated in June last year, the Government continues to subsidise retail prices of diesel, kerosene and cooking gas to cushion the consumers from volatile crude oil prices.