The Indian refiners are feeling the brunt of volatility in the international crude oil market, with price at which they buy their oil hitting the $100 a barrel mark. The Indian basket on Monday stood at $101.67 a barrel.

India imports about 80 per cent of its crude oil requirements and the international oil prices necessarily have a bearing on the domestic prices of petrol and other petroleum products. The volatility in crude oil prices, which has been triggered by political turmoil in Libya, is building pressure on the public sector oil marketing companies (OMCs) to review the retail prices of petrol.

“At present, the desired increase in petrol prices is about Rs 2.70 a litre (at Delhi),” an oil industry official told Business Line . The current retail price of petrol sold from Indian Oil Corporation's retail outlet in Delhi is Rs 58.37 a litre.

The Government had taken a decision to make price of petrol market determined both at refinery gate and at the retail level, effective June 2010. As the international oil prices have been rising, the OMCs have been revising the petrol prices accordingly.

However, in order to protect the common man from the impact of rise in international oil prices, the Government continues to modulate the prices of diesel, domestic LPG and PDS kerosene. “The companies also feel a constrain in raising petrol prices due to informal control by the Government,” an industry source said

“As a matter of fact, between July 1, 2010 and February 18, 2011, the OMCs have increased the petrol price only by 13.5 per cent as against the rise in petrol prices of 36 per cent in the international market, thereby absorbing a part of the increase in the international oil prices themselves,” the Minister of State for Petroleum and Natural Gas, Mr R.P.N. Singh, informed the Rajya Sabha on Tuesday.

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