The Union government on Thursday ruled out any hike in the price of petroleum products till June 15.
Global oil prices may not fall
"Between the third of June and the scheduled date of fortnightly revision on June 15, we have enough time to evaluate how international markets will react," Union Petroleum Minister Manishankar Aiyar told reporters as news of OPEC's decision to hike output filtered in.
Stating that OPEC (Organization of the Petroleum Exporting Countries) seemed to be working on moderation and stabilisation in international oil prices, the minister said, "As far as our domestic economy is concerned, these two words are music to our ears."
The UPA government will also take its allies particularly the Left into confidence before deciding upon a composite package that will address the frequent increases in petroleum prices, Aiyar said.
For the next couple of days, the oil ministry will watch how the international oil markets reacts to the OPEC decision to raise production by 2 million barrels per day before firming up with finance ministry ways of mitigating the crisis, he said.
On the cards is asking state-run oil firms, who have already lost Rs 900 crore (Rs 9 billion) on selling petrol and diesel below the cost since January, to bear part of the burden resulting from the high international prices and the government reducing marginally customs and excise duties on crude and products.
The next revision in prices of petrol and diesel is due on June 15, before which Aiyar will meet Finance Minister P Chidambaram to chalk out an approach to dealing with the spurt in oil prices.
"We will have to discuss the matter with the prime minister. And since we are running a coalition government, if not the nitty-gritty, the broad approach to dealing with the issue will be discussed with the coalition parties," Aiyar said.
Reacting to the OPEC decision, he said, "I think we were right in saying that we should wait for the June 3rd meeting of the OPEC."
"In 2-3 days time, we will be able to arrive at the short-to-medium term impact of the OPEC decision on oil prices. Once possibilities of near future are known, we will be able to firm up a package that will be discussed with the finance minister. Together we will meet the prime minister and at that point decide what proposal can be taken to the Cabinet," he said.
The minister said a considered decision will be taken on the pricing of petrol, diesel, kerosene and LPG. "The challenge before us is to establish before the country that we want to pursue economic reform with a human face."
