The Hindu : Front Page : Petrol, diesel prices go up

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Friday, Feb 15, 2008
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Petrol, diesel prices go up

Sujay Mehdudia

It is Rs. 2 more for petrol and Re.1 for diesel

NEW DELHI: Despite “strong opposition” from the supporting Left parties, the United Progressive Alliance government on Thursday increased the prices of petrol by Rs. 2 and diesel by Re. 1. The revision will come into effect from midnight on Thursday night.

The Cabinet Committee on Political Affairs (CCPA), headed by Prime Minister Manmohan Singh, took the decision after a recommendation by the Group of Ministers led by External Affairs Minister Pranab Mukherjee.

The hike, coming in the wake of spiralling international crude prices in the international markets, saw months of parleys within the government and among its allies and Left parties.

Petrol in Delhi will now cost Rs. 45. 52 against Rs. 43.52. In Kolkata it will be Rs. 48.95 against Rs. 46.86, in Mumbai Rs. 50.51 against Rs. 48.38 and in Chennai it will be Rs. 49.61 against Rs. 47.44.

Diesel in Delhi will now cost Rs. 31.76 against Rs. 30.76.

In Kolkata it will be Rs. 33.92 against Rs. 32.87, in Mumbai Rs. 36.08 against Rs. 34.94 and in Chennai Rs. 34.40 against Rs. 33.30.

The CCPA, however, decided against lowering the duties to cushion the impact of the surging global oil prices.

“We have tried to ensure that the common man does not suffer. This is just a marginal hike to save the oil marketing companies (OMCs) from bankruptcy. We appeal to the people to cooperate with us. The hike will come into effect from midnight on Thursday night,” Petroleum and Natural Gas Minister Murli Deora said at a press conference.

Mr. Deora said the CCPA also decided to raise the quantum of oil bonds to be issued to state-run oil retailers to partly compensate them for selling auto and cooking fuel below the cost.

At present, 42.7 per cent of the under-realisation on petrol, diesel, LPG and kerosene was met by the government through issuance of oil bonds. The percentage now was 56-57 per cent, Petroleum Secretary M.S. Srinivasan said.

The government companies would earn around Rs. 840 crore in the next six weeks of this financial year.

The Rs. 2 a litre increase in petrol would give Rs. 180 crore additional revenue a month to the public sector oil companies. In the case of diesel, it would be Rs. 360 crore a month.

Petrol and diesel prices were last raised in June 2006 and LPG prices by Rs. 20 a cylinder in November 2004. Kerosene prices have not been changed since 2002.

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