The Hindu Business Line : Decision on petro price by month-end: Deora

The Minister for Petroleum and Natural Gas, Mr Murli Deora, said he expects to meet the Finance Minister, Mr P. Chidambaram, members of Left parties and his party colleagues soon to discuss the issue. The decision whether to revise fuel prices or not would depend on the outcome of these meetings, he told media persons here on Monday.

The Minister has been trying to build a consensus on pricing of four petroleum products - cooking gas, kerosene, petrol and diesel - due to the adverse impact of the spiralling international crude prices on the performance of the state-owned oil marketing companies. This would be the second round of deliberations the Minister would be holding on the issue. The prices of petrol and diesel were last revised in September 2005.

"One more round of meetings is needed before we can finalise any plan," he said. The Left parties have opposed any increase in retail prices at a meeting with Mr Deora on May 10. The Left allies had maintained that the Government should share the burden without passing it on to the consumers by reducing duties.

Earlier this month, the Petroleum Minister had met the Prime Minister, Dr Manmohan Singh, the Finance Minister and Left parties to discuss the matter. The Petroleum Ministry has been explaining the current situation to all the decision markers concerned. The prices of Indian basket of crude oil had risen to a record level of $71.13 per barrel on May 2. The Indian basket on Friday (May 19) stood at $65.52 per barrel. The under recoveries of the public sector oil marketing companies (OMCs) are estimated to reach Rs 73,512 crore during 2006-07 in case there is no revision the prices of petroleum products.

Compared to March 2002, the international crude prices during 2006-07 have increased by 196 per cent, diesel prices by 255 per cent, kerosene by 260 per cent, petrol by 220 per cent and LPG (cooking gas) by 132 per cent.

However, the corresponding price increase since 2002 has been 64 per cent for petrol, 84 per cent for diesel, one per cent for kerosene, and 23 per cent for LPG, the Ministry has argued. The present retail prices of petroleum products corresponds to Indian basket of $51 per barrel, the Ministry said.

The required price increase in Delhi would be Rs 9.33 a litre on petrol, Rs 10.43 a litre for diesel, Rs 17.16 a litre for kerosene and Rs 114.45 for LPG, as per the estimates.