Whether your petrol bill will go up from April or not will depend on the Finance Ministry.
The Petroleum Ministry has stepped up pressure on the Finance Ministry to reimburse the losses incurred by public sector oil companies for selling petroleum products below the market price. If not compensated, the companies will be left with no option but to increase fuel prices, particularly petrol — which has been deregulated.
Marketing companies — Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation — review the retail prices every fortnight, based on an average benchmark of crude oil prices and currency exchange rate (rupee versus dollar). The next review is expected on March 31.
Though the Petroleum Minister, Mr S. Jaipal Reddy, gave no indication of a petrol price revision, he did agree that rise in international crude oil prices is a matter of concern.
Recently, Indian Oil Corporation Chairman, Mr R.S. Butola hinted that the price of petrol may be raised from April. But a hike may happen only if the request to reimburse losses on sale of petrol for the current fiscal is not met, he said.
The companies are selling petrol at about Rs 7.70 a litre lower than the market price, diesel at Rs 14.73 a litre, domestic LPG at Rs 439 a cylinder, and PDS kerosene at Rs 30.10 a litre.
The total revenue loss to be incurred by the three oil marketing companies is estimated to be Rs 1,40,000 crore for the current fiscal.
Of this, the Finance Ministry has given Rs 45,000 crore and upstream contribution has been about Rs 53,000 crore. “We have requested the Finance Ministry to give the remaining amount (Rs 42,000 crore),” the Petroleum Secretary, Mr G.C. Chaturvedi, said.
The marketing companies have demanded that since they have not been able to raise petrol price in line with increase in cost, they be compensated by the Government for the Rs 4,500 crore loss they incurred on the fuel sale. The upstream companies —ONGC and Oil India — have pushed for offsetting the additional cess burden that they will incur by reducing the subsidy burden on these companies.