No fuel price hike for now: Deora

The government on Monday ruled out any immediate increase in petrol and diesel prices despite a spurt in international crude oil prices. "We have no plans to hike prices of petrol or petroleum products for the time being," Union petroleum minister Murli Deora told reporters in Srinagar.

Deora, who chaired a regional meeting of Jammu and Kashmir, Himachal Pradesh and Uttarakhand, said reviewing prices of petroleum products was a continuous process. Prices of petroleum products have not been reviewed since February.

International crude prices have risen 10-12 per cent since mid-February when petrol prices were slashed by Rs 2 a litre and diesel by Re one per litre. In response to a question, Deora said the government was yet to take a final decision on the quantum of oil bonds to be given to state-run oil marketing companies.

"This is under discussion... we are still to meet the finance minister. How much, we can't say (but) we will try our best to get the maximum," he added. The government's refusal to allow companies such as Indian Oil Corp, BPCL and HPCL to raise prices is likely to cause a revenue loss of more than Rs 50,400 crore (Rs 504 billion) this year, according to industry estimates.

At least one-third of this projected on fuel sale will be borne by upstream firms like ONGC, while the government will also share part of the burden by way of compensating fuel retailers through issue of oil bonds. The rest will have to be split between the retailers and the consumers.

After talks between finance and oil ministries, the Cabinet will decide on the bonds to be issued to IOC, BPCL and HPCL as also the need for raising prices.