Our Bureau

New Delhi, Jan. 19

THE Petroleum Minister, Mr Mani Shankar Aiyar, today emphatically said there was no proposal to raise domestic cooking gas (LPG) and kerosene prices in the immediate future.

Responding to a question on whether his Ministry has moved a proposal to hike the prices of these two petroleum products, Mr Aiyar denied having presented to the Cabinet any such proposal.

"I deny any document called note for Cabinet has been circulated on the issue," he said adding, "it is the job of the Ministry of Petroleum and Natural Gas to constantly monitor prices and constantly evaluate options for dealing with sensitive petroleum products."

``There is no note for Cabinet and no date fixed for Cabinet discussion on the issue," he stated.

Asked whether the oil firms were seeking an increase in fuel prices, Mr Aiyar said: "As Navratnas they want prices to be raised to sustain their bottomlines. But as a Minister it is my job to see what people at large can sustain."

There has been some speculation that the Petroleum Ministry would be seeking Cabinet approval for an increase in retail prices of PDS kerosene by Rs 2 per litre and domestic LPG by Rs 50 per cylinder at Delhi. The retail prices in other locations would be determined based on price increases proposed at Delhi.

The oil marketing companies are likely to incur significant under-recoveries owing to the continued mismatch between domestic and international prices, particularly in the case of PDS kerosene and domestic LPG.

As per projections for 2005-06, gross under-recoveries on PDS kerosene and LPG were to be Rs 23,236 crore and on petrol and diesel Rs 14,918 crore. The total under recoveries were projected at Rs 38,154 crore for 2005-06, up from Rs 20,146 crore in 2004-05.

(This article was published in the Business Line print edition dated January 20, 2006)
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