Petrol pricing may have been decontrolled last June, but the Government control on deciding the rates was more than evident in the last two days. The oil retailers decided to hold back their decision to raise prices despite volatility in international product price and currency fluctuation against the dollar.
The move will please the consumers as well as the UPA allies.
After two consecutive price cuts in November, in sync with the international petrol prices, the public sector oil retailers – Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation – were inclined to increase the retail prices by about Rs 0.65-Rs 70 a litre (base price to be raised by about Rs 0.50 a litre).
Also prepared were private retailers such as Essar. However, insiders say the retailers might wait for the winter session of Parliament to get over, which is expected to be December 22.
In a statement issued here, Indian Oil Corporation said, “In view of the RBI having taken steps and following strengthening of the rupee, the company is reviewing the situation and will decide on the price revision at an appropriate time.”
Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation revise the rates on the basis of fortnightly average of international prices based on the international price (f.o.b) of product and currency fluctuation.
The fall in currency versus dollar resulted in an increase in the cost of oil imports. Parallelly, international price of petrol (Singapore price) has also increased since the last price cut. Every dollar increase or decrease in Singapore petrol prices will have an about Re 0.31 impact on the domestic price, an official said.
While reducing the retail price, last month, the public sector oil retailers had cautioned that current trend of increasing international petrol prices and further deterioration of exchange rate will impact the direction of prices in the next pricing cycles.