Oil Cos to absorb price volatility; no hike in fuel prices

New Delhi, Aug 20 (UNI) With the August one deadline for monthly revision of fuel prices around the corner, the government-run oil marketing companies remain firm on not passing on their Rs 73,000 crore accumulated loss due to volatile oil prices worldwide to the consumers.

In other words, any hike in fuel prices, whether petrol or diesel, is not imminent, Petroleum Ministry officials said.

The oil marketing companies have so far not effected any adjustments in prices since last price increase on June 6, 2005.

The Union Cabinet had on June 5 raised the petrol price by Rs 4 per litre and diesel by Rs 2 per litre and had given autonomy to the public sector retailers to raise prices when the Indian basket of crude oil stayed above 70 dollars a barrel for a month. The government, however, did not increase the prices of PDS kerosene and domestic LPG to protect the interests of the common man and the weaker sections of society.

The average price of the Indian basket of crude oil at the last time of hike was 66 to 67 dollars a barrel. Even though the July average, stayed well over 71 dollars a barrel public sector oil firms have decided not to pass on the surge on August 1, when the monthly revision was due.

''During the current month (July-Aug), the Indian basket has averaged over 73 dollars per barrel,'' the officials said.

Last month also the government did not revise the oil prices when the crude oil prices had gone up to a record 78.40 dollars per barrel as the West Asia crisis had reached its peak.

However, government sources said they are keeping a close watch on the turbulent situation in the West Asian region and any decision would take place after August one.

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