The Hindu Business Line : Decision deferred on petro price increase

THE Government on Saturday deferred a decision on the issue of raising the retail prices of petrol and diesel prices. A decision is likely to be taken tomorrow.

"Further consideration and consultations are required, which will begin tonight. Whatever is the outcome will be announced by the oil companies tomorrow," the Union Petroleum Minister, Mr Mani Shankar Aiyar, told newspersons, after a brief meeting with the Prime Minister, Dr Manmohan Singh.

Public sector oil marketing companies have been seeking a revision in retail prices owing to a sharp rise in price of crude oil.

As per a formula set out by the Government in July this year, oil companies were free to raise prices of petrol and diesel by around Rs 1.30 per litre in the case of petrol and Rs 2.20 per litre in the case of diesel. However, the Government intervened and forbid any automatic raise in prices.

Oil companies are scheduled to revise prices on a fortnightly basis and hence the build up for a possible rise in prices on October 31.

Crude prices have risen by around 30 per cent since July-end when prices were last revised.

Public sector oil marketing companies have lost around Rs 3,600 crore in the last seven months as they have been forced to retail petrol and diesel at prices well below what it would have cost to import and sell it.

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