BRAINSTORMING ON OIL: From left: R. K. Pachauri, Director-General, TERI, Ashok Sinha, Chairman and Managing Director, BPCL, and R. K. Narang, Director, Reliance Industries, at a panel discussion on petroleum pricing in New Delhi on Monday. — Photo: Kamal Narang

NEW DELHI: The oil industry has called for shifting to market-determined prices for all petroleum products, including LPG and kerosene. Concurring with the assessment made by The Energy and Resources Institute (TERI), the industry has pointed out that any dual pricing strategy for petroleum products like kerosene will lead to leakages in the system and will be difficult to control. The need for shifting to a market determined pricing system was highlighted here on Monday by representatives of major public and private oil companies, including Bharat Petroleum Corporation Limited, Indian Oil Corporation, Hindustan Petroleum Corporation Limited, Reliance Industries Limited and BP India Services at a panel discussion organised by TERI. While recognising the challenge of making cooking and lighting fuel affordable to the poor, industry representatives felt that the current system was, in reality, subsidising the richer strata of the society.

Subsidy for select groups

According to a TERI analysis, just the top 6.75 per cent of the population enjoys 40 per cent of the LPG subsidy; and it is urban areas that benefit from 76 per cent of the subsidy. Commending recent efforts by the Government to address this problem, the industry representatives maintained that any dual pricing strategy for petroleum products would lead to leakages in the system and would be difficult to control. The oil companies were, thus, in favour of moving to a single market determined price for all petroleum products, including LPG and kerosene. Subsidies could be provided to carefully targeted consumer groups as direct subsidies using technological advances in the form of debit or pre-paid cards.

The company representatives endorsed the attractiveness of using LED (light-emitting diode) based solar home lighting systems for meeting energy needs in rural areas, which would also go a long way in enhancing the energy security of the country. Apart from being cleaner and environmentally superior to kerosene lamps, solar home lighting systems were a more efficient source of lighting.

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