Petroleum Minister Murli Deora on Friday said the government would wait for international crude prices to stabilise before announcing any cuts in domestic petrol and diesel prices.
"We cannot take a decision on the basis of international crude price falling below $50 for a day or two. We will have to wait for the stabilisation of crude prices before taking any decision to reduce petrol and diesel prices," he said on the sidelines of Petrotech conference.
"Government will take decision about cut in prices at the appropriate time," Deora said, adding he would meet Finance Minister P Chidambaram next week to seek cut in excise duty on oil products.
Deora had earlier said the government would review prices if global crude prices slip below $50 per barrel.
He also said under-recovery of state-run oil marketing companies was likely to remain at about Rs 50,000 crore (Rs 500 billion) this fiscal as against about Rs 72,000 crore (Rs 720 billion) during previous year.
The Indian crude basket slipped below $50 per barrel at $49.85 on Wednesday - raising hopes that the government could soon review domestic oil prices.
Speaking at the conference, Minister of State for Finance Pawan Kumar Bansal said government would continue to provide subsidy on fuel, especially kerosene.
"Government will continue fuel subsidy considering that 10 per cent of rural population is living below Rs 9 a day and 30 per cent of urban population living at Rs 19 a day," Bansal said.
When asked, Deora admitted that due to limited storage facilities in the country, buffer stocks of oil products could not be increased immediately to take benefit from the current lower international crude prices.
International crude oil prices are ruling at around $52 a barrel compared to a high of $70-75 in July-August last year.
However, Deora said, the government have plans to increase buffer stocks of around one million tonnes crude oil, which would take some time to materialise.
Referring to oil stocks, Indian Oil CMD S Behuria said during current peak season of demand, company's inventories were sufficient for 20-22 days, which normally increase during the lean period in demand.
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