Diesel, kerosene and cooking gas prices may be hiked soon while the government may separately take up a proposal to raise cap on the supply of subsidised LPG cylinders.
The government may take a look at raising the cap on supply of subsidised LPG cylinders to nine per household in a year from the current limit of six along with the Vijay Kelkar Committee recommendations to deregulate diesel prices by next year along with steep hike in cooking fuel rates.
The Kelkar Committee, which was appointed by Finance Ministry to suggest a roadmap for fiscal consolidation, had recommended an immediate hike in price of diesel by Rs. 4 per litre, of kerosene by Rs. 2 a litre and of LPG by Rs. 50 per cylinder.
"That (Vijay Kelkar committee recommendation on deregulating diesel and raising kerosene and LPG rates) is a proposal. It is still at proposal stage. The (Petroleum) Ministry is only processing that report and we are yet to take a decision," oil minister M Veerappa Moily told reporters in New Delhi.
Though the minister did not indicate a price hike soon, officials speaking on condition of anonymity said a proposal based on Kelkar Committee recommendations will be taken to Cabinet soon and rates will go up if it is approved.
Price of diesel, which currently costs Rs. 47.15 per litre in Delhi, was last revised on September 14 when it was hiked by a steep Rs. 5.63 per litre. Kerosene rates have not changed since June 2011 and it currently costs Rs. 14.79 per litre in Delhi.
State-owned oil companies currently sell diesel at a loss of Rs. 10.16 per litre, kerosene at Rs. 32.17 a litre and LPG at Rs. 490.50 per 14.2-kg cylinder.
Moily said the government was also considering raising the cap on supply of subsidised cooking gas (LPG) cylinders to 9 per household in a year from current limit of six.