Oil cos will roll back price hike if govt gives a directive

Facing all-round criticism for a steep hike of Rs 1.80 a litre in petrol price, state-owned oil companies on Friday said they will roll back the increase in rate if the government gives a directive to that effect.

At a hurriedly called press conference, Indian Oil Corporation (IOC) Chairman R S Butola said the government had freed petrol prices in June last year and empowered oil

companies to decide the retail rates, but given the ownership structure the PSUs we will abide by the government directive to roll back prices.

"We do not plan to affect a roll-back of prices, but if we get a directive (to roll-back prices), we will have to implement that," Butola, who was accompanied by BPCL Chairman R K Singh, said.

Explaining the reasons for hike in petrol prices, Butola said the oil marketing companies had lost Rs 2,468 crore (Rs 24.68 billion) on selling the fuel below cost in the first half of the current fiscal. This was on top of Rs 2,500 crore (Rs 25 billion) loss they incurred in 2010-11.

"Given the magnitude of the losses, the choice before us was to either cut down production or pass on the increase to consumers. We chose to raise prices and continue supply lines," he said.