Any increase in the prices of petrol and diesel may have to wait till the budget. With global crude oil prices falling below $90 a barrel, the government is exploring the option of coming out with an overall package for the petroleum sector in the budget.
Petroleum Minister Murli Deora had held detailed discussions with Prime Minister Manmohan Singh and Finance Minister P Chidambaram on the issue during the past two days. The government is not too keen on a piecemeal solution barely three weeks before the budget, sources said.
In such a scenario, the Cabinet is unlikely to consider the issue of petrol and diesel price increase at its meeting tomorrow. Deora was also non-committal on the issue saying, “I cannot say if revision is happening or not.”
Oil marketing companies are losing Rs 10.57 per litre in petrol, Rs 11.56 per litre in diesel, Rs. 19.89 per litre of kerosene, and in LPG it is Rs 331.34 per 14.5 kg of a gas cylinder. The total under-realisation for the financial year is estimated to be Rs 71,808 crore.
Going by the present formula of government oil bonds meeting 42.70 per cent of the under-realisation on petrol, diesel, LPG and kerosene and 33 per cent coming from upstream firms, Rs 17,000-crore deficit has to be bridged.
A Re 1 per litre increase in petrol price would give Rs 90 crore a month additional revenue to public sector oil companies. A similar hike in diesel would fetch Rs 360 crore a month. A Rs 10 per cylinder increase in LPG prices would result in Rs 58 crore additional revenues every month.