With inflation peaking to a 13- year high of 12.44 per cent in an election year, the government looks set to dump the high-powered BK Chaturvedi Committee’s recommendations of a monthly increase in fuel prices till they are at par with cost.
The suggestions for raising petrol prices by Rs 2.50 a litre per month till March 2009 and diesel by 75 paise till 2010 was not acceptable to even the Prime Minister’s Office and Oil Minister Murli Deora is likely to perform the ritual of giving the report a burial at a industry meeting with heads of oil firms on Tuesday.
“No one can think of raising fuel prices when global rates are softening,” a top official said.
Decline in international crude oil prices from highs of $147 per barrel last month to $113-114 per barrel currently, has led to a reduction in revenue losses on fuel sales by one-fourth to Rs 450 crore per day.
However, some suggestions such as use of smart card for sale of subsidised kerosene may get support.
Dual pricing of diesel — one for luxury diesel cars and one for trucks and tractors — may also not get support due to problems with its implementation.