Oil firms campaign to justify price hike | business | Hindustan Times
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Oil firms campaign to justify price hike

business Updated: Jun 05, 2012 23:07 IST
Anupama Airy
Anupama Airy
Hindustan Times
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Stung by the sharp criticism from all parties across the political spectrum — including two union Cabinet ministers from the ruling UPA government — for the recent R7.5-per-litre hike in petrol price, the three state-owned oil marketing companies — Indian Oil, Bharat Petroleum and Hindustan Petroleum — on Tuesday ran a nationwide ad campaign to justify step.

The message they sought to convey was that their combined profits are not “huge” but just enough to maintain their blue chip status and credit ratings at the global level.

The oil companies also said that a combined profit of R6,177 crore during 2011-12 on a combined turnover of R8,33,000 crore worked out to a mere 0.7% of turnover — which is not even sufficient to meet their capital expenditure requirements.

The campaign did not however pacify the political class, who termed it a “political gimmick” and “useless tactics”.

“The common man is the hardest hit from this hike and no explanation is good enough to justify it,” said senior BJP leader and former petroleum minister Ram Naik. “It is absurd to think that such campaigning would do any good when explanations from the highest UPA leadership including the PM, finance minister and the petroleum minister could not justify the hike.”

While Congress allies including the TMC and DMK sided with the Left and the BPJ to protest against the hike, even two union ministers — Vayalar Ravi and AK Antony — joined in the chorus. Overseas Indian Affairs minister Vayalar Ravi in fact rejected the oil companies’ claim that they are running in losses.