Decision on fuel price hike

Oil minister, Murli Deora, said on Thursday that the government would take a decision on raising fuel prices in the next two to three days. Earlier it was reported that the government would decide on the fuel price hike on Friday.

The cabinet is expected to discuss a range of proposals to ease losses at state oil firms due to crude oil's record run later on Thursday, and an increase in petrol and diesel prices is one option.

Reports say that the bailout package for oil companies would be a mix of price hike, duty cuts and bonds. The Finance Ministry may also agree to some cut on excise, customs on petro products.

The Petroleum Ministry has been pushing for a Rs 10 per litre hike petrol prices, Rs 5 a litre in diesel and Rs 50 per LPG (cooking gas) cylinder.

In the absence of a hike, state-run oil companies HPCL and BPCL would run out of cash to import crude in the next two months, while Indian Oil Corp has said it would run out of money for buying crude by September-end.

Resources - Economictimes