Fuel price hike unlikely to be on tomorrow's cabinet agenda

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Noida, Feb 6 (UNI) The politically sensitive decision to hike retail prices of fuel is unlikely to figure in the agenda for the cabinet meeting to be held here tomorrow.

Speaking on the sidelines of a conference, Petroleum Minister Murli Deora today said, '' the cabinet is expected to meet tomorrow but I cannot say if a price revision will happen.'' A ministry official added that the cabinet will meet tomorrow but a price revision was ''not on the agenda'' as of now.

Sources said that several UPA alliance members, including the Left are against any hike in fuel prices in the wake of general elections just a year away.

A hike in fuel prices was expected since October-end when global crude oil prices began its surge, hitting the bottomlines of domestic oil marketing companies (OMCs).

The Government is also now contemplating on increasing the quantum of oil bonds to OMCs.

The Group of Ministers (GoM) on fuel prices, headed by External Affairs Minister Pranab Mukherjee, met on January 31 and decided to leave the final decision to the Cabinet.

The GoM is understood to have narrowed down to two options-- raising petrol price by Rs 4 or Rs 2 a litre and diesel by Rs 2 or Re 1 per litre.

However, Mr Deora today dismissed any speculations and stated that the final call was for the cabinet to take.

Mr Deora has always maintained that it was for the cabinet to accept or reject any recommendation it makes and the power and the final shape to the issue will depend entirely on the cabinet's decision.

Petrol and diesel prices were last raised in June 2006, when crude oil was at 67 dollars a barrel. It is beiung traded at 88 dollars a barrel today LPG prices were last raised by Rs 20 per cylinder in November 2004, when crude was at 34 dollars a barrel. Kerosene prices have not been changed since 2002 when crude was at 23 dollars per barrel.

A Re 1 per litre increase in petrol price would give Rs 90 crore a month of additional revenue to public sector oil companies.

A similar hike in diesel would fetch Rs 360 crore a month, while Rs 10 per cylinder increase in LPG prices would result in Rs 58 crore worth of additional revenues every month.

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