In a move to protect the interests of national oil companies against the fluctuations in global crude prices, the government on Monday decided to grant these PSUs limited freedom to fix petrol and diesel prices.
The decision to grant permission to oil PSUs to fix prices of auto fuel on their own, within a range of 10 per cent, was taken at the meeting of the Cabinet Committee on Economic Affairs.
"A ceiling and floor price within a range of 10 per cent of the three-month average would be set, within which oil companies would have the freedom to revise prices every fortnight," Petroleum Minister Mani Shankar Aiyar told reporters after the CCEA meeting.
If this price band was breached, then the oil companies would have to consult the government, he added.