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Review only after global crude prices stabilise: Deora

Sujay Mehdudia

NEW DELHI: Under pressure from within the party and its ally, Trinamool Congress, to review the recent hike in prices of petrol and diesel, Petroleum and Natural Gas Minister Murli Deora on Thursday hinted that if the international crude oil prices stabilised between $50 to $60 a barrel, the government would consider re-visiting the Rs. 4 a litre hike in petrol prices and Rs. 2 a litre increase in diesel.

“We will cut prices and have a re-look if the current trend of decline in the international market continues for two to three weeks. We had assured that we will have a review of the situation if prices come down and we are still maintaining that stand,” he added.

Ever since the government hiked the prices, when international prices were at $70 a barrel, prices of crude oil have been showing a downward trend. The basket of crude oil India buys was at $61.42 a barrel on Thursday but the average for July was $65.34 a barrel. The July average was certainly lower than $69.12 a barrel average price of Indian basket of crude for June.

However, sources said that within the Congress, pressure was building to roll back the prices in view of the easing of prices in the international market. Although, it has not gone on record about the demand, sources said the Trinamool has conveyed to the Congress and those in the government that it wanted the prices cut immediately.

A similar demand was made by the Bharatiya Janata Party on Thursday and similar sentiments were echoed in the Rajya Sabha where some members wanted a cut in view of the decline in international crude oil prices.

However, Mr. Deora said the hike was unavoidable as India was dependent on imported crude oil to meet 75 per cent of its domestic oil needs.

The Indian Oil Corporation, the Bharat Petroleum Corporation Limited and the Hindustan Petroleum Corporation Limited were projected to lose Rs. 4,870 crore in revenues every month on selling petrol, diesel, domestic LPG and kerosene below the cost.

“To cover this loss, the retail prices were required to be increased by Rs. 6.94 per litre on petrol, Rs. 4.11 a litre on diesel, Rs. 96.68 per LPG cylinder and Rs. 16.01 per litre on kerosene,” he added. On July 1, the price of petrol was increased only by Rs. 4 a litre and of diesel by Rs. 2 a litre.

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