Petrol prices may go up again next month

If you thought the steep Rs 5-per-litre hike in the price of petrol that hit you this weekend was big, you could be in for another blow. State-run oil marketing companies are mulling a similar hike that could come as early as next month. Anupama Airy reports. Inflation rises

If you thought the steep Rs 5-per-litre hike in the price of petrol that hit you this weekend was big, you could be in for another blow. State-run oil marketing companies are mulling a similar hike that could come as early as next month.

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“We don't have a choice. If global oil prices continue to be high, we may have to implement another petrol price hike as early as next month,” an executive of a public sector oil company told HT, requesting not to be named.

An empowered group of ministers is to meet in the coming days to decide on raising the prices of diesel, cooking gas and kerosene even as the government battles for ways to cool inflation that had hit a 16-year high of 9.38% during 2010-11.

“A decision will be taken on raising prices of these items when the (panel) meets next week,” finance minister Pranab Mukherjee, who chairs the panel, said on Sunday.

On Saturday oil firms raised petrol prices by R5 per litre and sources said the EGoM could consider a R4-per-litre increase in diesel prices and a hike of R20-25 per cylinder of LPG. Higher petrol, diesel and cooking gas prices will likely push up inflation rates further.

Last year, the Centre freed petrol prices and allowed oil firms to fix prices of the transport fuel. The Centre, however, continues to regulate prices of diesel, kerosene and LPG.