"We will respond suitably in case there is a fall in the international crude prices," Petroleum Minister Murli Deora said in the Lok Sabha.
His response came to demands from the Opposition as also two allies of the ruling UPA, DMK and Trinamool Congress, for withdrawal of the price hike effected from midnight. Deora also left it to the state governments to reduce sales tax imposed by them on petroleum products.
When the price of the Indian basket of crude products had declined from $142 to $40 in December last year, "the government responded by reducing the petrol price by Rs 10 and diesel price by Rs 4 in two stages in two months," Deora said.
But now the crude prices have once again risen to $70 or a "75 per cent hike since December", he said adding that this had resulted in the oil manufacturing companies reporting under-recoveries of Rs 70,200 crore (Rs 702 billion).