Mumbai, Jan 16 (PTI) Indian Oil Corporation today saidthe decision to hike oil prices was logical, as crude oilprices had skyrocketed in the international market.
"The current increase in the retail price of petrol wasnecessitated. Based on current price levels in theinternational oil market, the desired increase in the retailselling prices of petrol in New Delhi market should have beenRs 3.72 per litre," Indian Oil Corporation Chairman B M Bansalsaid in a statement.
IOC has chosen to soften the impact by increasing theprice by Rs 2.50 per litre only and not passing on the balancerequired increase of Rs 1.22 per litre, Bansal said.
Public sector oil companies yesterday announced a Rs2.50 per litre hike in the price of petrol. Petrol at IndianOil filling stations in Delhi will now cost Rs 58.37 perlitre, up from Rs 55.87 a litre.
This is the second hike in petrol prices in a month ascrude oil prices have skyrocketed to USD 92 a barrel in theinternational market.
He said due to the persistent rising trend in theinternational oil prices, average prices of the Indian crudebasket have gone up from USD 87.83 a barrel during theearlier petrol price revision in December to the current levelof USD 92.31/bbl amounting to an increase of USD 4.48 perbarrel.
Owing to the substantial increase in oil prices, OilMarketing Companies are continuing to incur huge amounts ofunder-realisations on the sales of other petroleum productslike diesel, kerosene(PDS) and LPG (Domestic), he said.
"Indian Oil is currently incurring an under-realisationof about Rs 159-crore per day on the sales of these threesensitive products," he said.