No diesel decontrol but get used to petrol swing

The government has no plans to decontrol the pricing of diesel or cooking gas since they have a cascading effect on headline prices, minister of state for petroleum R P N Singh said on Monday. 

But the minister said people should “get used” to changes in petrol rates being effected every fortnight. “There is no meeting scheduled (of the ministerial panel on fuels) to decide on (raising) diesel or LPG (cooking gas) prices,” Singh said. This may be seen as a hint that while consumers will continue to get relief on cooking gas and diesel, petrol price may go up again in 10 days or so in view of the rupee’s continued fall and the crude and petrol prices in bulk markets reversing the trend since the last cut in pump price. 

The government had last June freed petrol pricing from its control but continues to set retail prices of diesel, cooking gas and kerosene. State-run oil marketing firms at present sell diesel at a loss of Rs 13.53 per litre, kerosene at Rs 29.99 and cooking gas at Rs 287 per 14.2-kg refill. On the three controlled products, Indian Oil, Bharat Petroleum and Hindustan Petroleum are projected to lose Rs 137,605 crore in revenue this fiscal. The three firms are losing Rs 425 crore per day on sale of diesel, cooking gas and kerosene at the artificially low price set by the government. 

The ministerial panel is headed by finance minister Pranab Mukherjee and decides the prices of controlled products. Oil marketers had last month effected three price revisions in petrol-—first hiking rates by Rs 1.80 per litre on November 3, then reducing it by Rs 2.22 per litre on November 15 and a further cut of 78 paise a litre on November 30.