Domestic cooking gas and kerosene prices will not be raised in the immediate future, with Petroleum Minister Mani Shankar Aiyar on Thursday denying having presented to the Cabinet a proposal to raise prices of the mass consumed cooking fuels.
"I hotly (sic) deny any document called note for Cabinet (has been) circulated on the issue (of raising fuel prices)," he told reporters on sidelines of a landmark agreement signed between Oil and Natural Gas Corp and Royal Dutch/Shell in New Delhi.
The petroleum ministry had been toying with the idea of making up the uncovered cost of LPG cylinder by raising prices by Rs 100 a cylinder in two installments.
It was also weighing the option of increasing kerosene price by Rs 2 a litre to partly bridge the about Rs 11 a litre difference between cost and the retail selling price, while introducing a dual pricing mechanism for people living above and below the poverty line.
"It is the job of the ministry of petroleum and natural gas to constantly monitor prices and constantly evaluate options for dealing with sensitive petroleum products.
"There is no note for Cabinet and no date fixed for Cabinet discussion on the issue," Aiyar said.
Public sector oil firms currently loose over Rs 130 per LPG cylinder as government subsidy is unable to cover cost. There is a discount of Rs 11 per litre on kerosene and and a loss of over Rs 2 a litre on diesel. Oil firms barely break even on sale of petrol.
"I have said several times (that) it is for the petroleum ministry to suggest options (but) ultimately the decision has to be taken by the government as a whole," he said.
Aiyar admitted that public sector oil firms have demanded an immediate increase in fuel prices to cut losses.
"As Navratnas they want prices to be raised to sustain their bottomlines. But as a minister it is my job to see what people at large can sustain," he said.
"It is not my job to raise or lower prices. My ministry's job is to monitor prices and it is for the Cabinet to decide on the issue," he said.
The petroleum minister blamed paper traders for the spurt in international oil prices saying there was no reason for the crude oil prices to be so high as availability matched global demand.
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