Dual pricing policy can be attempted by selling fuel to two-wheelers at lower price and four-wheelers at the import parity price as a measure to minimise the losses of the oil marketing companies, IOC chairman Sarthak Behuria said at the Indian oil and gas review symposium in Mumbai.
He said the premium fuels should be sold on import parity price and there should be relaxation in the product specification to take advantage of the differential between low sulphur and high sulphur fuels.
As an immediate measure, the government should look at rationalising the advalorem duty on imports of crude oil while as a long-term measure the substitute fuels, including blended ethanol should be encouraged, he said.
Citing the examples of China, which has resorted to rationing, announced three price hikes this year and was thinking of imposing a fuel tax, and Thailand, which has abolished all fuel subisidies, he said similar measures could be tried in India too.
Stating that under-recoveries were compounding the problems of state-run oil companies, he said IOC had lost Rs 1,800 crore (Rs 18 billion) Bharat Petroleum Rs 1,300 crore and Hindustan Petroleum Rs 1,050 crore due to non revision of fuel prices.