Click to play videoNew Delhi: In what comes as bad news for the consumer, the Government is actively considering raising prices of auto fuels so oil marketing companies can be compensated for losses running to Rs 600 crore a day.
The Petroleum Ministry is putting together a bail-out package to compensate Indian Oil, BPCL and HPCL, after running through all the options with the Prime Minister.
“It now seems that a price hike is inevitable, all options are before us,” said Petroleum Secretary, MS Srinivasan.
Sources tell Network 18 the Petroleum Ministry is finalising a Cabinet note by Saturday which will seek a price hike of Rs 5/l on diesel and more than Rs 5/l on petrol. This means a litre of diesel could cost Rs 36.76 rupees in Delhi, while petrol in the capital may cost Rs 50.52.
The Ministry is trying to avoid the price hike by pushing for duty cuts but the proposal still finds no favour with the finance minister P Chidambaram.
“The PM is sympathetic to the plight of the oil marketing companies. The Government realises something has to be done,” said Petroleum Minister, Murli Deora.
But indications of a price hike have already set of rumblings of discontent within the UPA. Said CPI General Secretary, A B Bardan, “We want cut in duties as we have always said.”
Sources say the Ministry has been asked not to hike prices till the end of functions to mark the fourth anniversary of the UPA Government.
Not surprisingly, Deora says the bailout pacakge will only be announced next week.
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