After doubling the prices of natural gas produced by state-owned gas firms, the government looks set to bite the bullet on auto fuel prices with a panel of ministers scheduled to meet on June 7 to decide on freeing petrol and diesel prices.
An Empowered Group of Ministers (EGoM) headed by Finance Minister Pranab Mukherjee is scheduled to meet on June 7, a top petroleum ministry official said.
Besides freeing petrol and diesel prices from the government control, dealing with the revenue lost on selling domestic LPG and PDS kerosene below cost is also on agenda of the ministerial panel.
For petrol and diesel prices to be freed from government control, rates would have to be raised by over Rs 6 a litre.
Indian Oil Corp, Hindustan Petroleum and Bharat Petroleum lose Rs 2,555 crore a day by selling fuel below cost.
Industry sources said the EGoM may decide to free just the petrol price for now and approve a marginal increase in diesel and LPG rates.