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Deregulation of fuel prices gains urgency

Murli Deora

NEW DELHI: With hints of continuity in Petroleum Ministry, the outgoing Petroleum and Natural Gas Minister, Murli Deora, on Saturday declared that deregulation of fuel prices and revising rates of natural gas sold by State-run oil and gas firms would form the top priority in the second term.

Mr. Deora, tipped to retain the Petroleum and Natural Gas Minister portfolio with Cabinet status, is also all set to break the jinx that no Petroleum Minister has returned to office for a second successive term. The Petroleum Ministry had already prepared a draft note giving public sector Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation a free hand to fix petrol and diesel prices when crude oil prices were below $75 a barrel and raising rates of natural gas produced by Oil and Natural Gas Corporation (ONGC) and Oil India from nominated fields.

Interestingly, no one ever has completed a full five-year term in office as Petroleum Minister and none have ever been repeated. Former Petroleum Minister in the NDA Government Ram Naik was the longest serving Minister with his term lasting nearly four-and-half years from end-1999. An industrialist by profession, Mr. Deora became a Cabinet- rank Minister in January 2006 when he replaced Mani Shankar Aiyar as Minister for Petroleum and Natural Gas.

Although, refusing to speculate about the allocation of the Petroleum portfolio once again, Mr. Deora, after taking oath as a Cabinet Minister, said he would give a detailed view about the vision of the Petroleum Minister after the formal allocation of the portfolio by the Prime Minister, Manmohan Singh. “Prime Minister has not told me anything,” Mr. Deora said but in all certainty is likely to continue as Petroleum Minister.

He, however, said that issues of deregulation of petrol and diesel prices would very much be on agenda for the new Government. “Despite the oil and gas prices reaching $147 a barrel in the international market last year, we insulated the consumers from price hike and later went on to reduce prices two times. Our attempt has been to make available fuel to common man at affordable price,” Mr. Deora said.

“My personal opinion is that it is the right time to free petrol and diesel prices. But [the] poor should continue to get cooking fuel like kerosene at subsidised rates. Nowhere in the world is kerosene sold at Rs. 9 a litre. It is cheaper than even mineral water,” he added.

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