The government on Thursday allowed public sector oil companies to hike the price of petrol by Rs 3.14 per litre, further burdening the middle- class. The new price will come into effect from midnight Thursday.
Petrol will now cost Rs 66.84 a litre at filling stations in Delhi, and even more in Gurgaon and Noida because of steeper levies in the NCR. Political parties condemned the move. "In the last six years, the UPA government has increased petroleum prices at least 117 times. Our economist Prime Minister has completely failed and his management of the economy is restricted to pleasing the rich," BJP leader Muqtar Abbas Naqvi said.
"The government has increased the burden of common citizens, particularly the middle class. The UPA is not able to combat either corruption or inflation. Gas prices are also likely to be increased. We condemn this move," SP spokesperson Mohan Singh said.
CPM leader Brinda Karat said the party will hold nationwide protests, arguing that the hike had been effected when global oil prices are down.
The latest revision is the third in 2011 and makes the fuel costlier by a whopping 20 per cent since the first price revision on January 15 this year.
Petrol prices have gone up by Rs 11 since the beginning of this year. The price of the fuel was last increased by a hefty Rs 5 per litre on May 15. The increase since June last year, when the government first announced its new policy of market- determined prices for petrol, works out to a huge 34 per cent.
The latest hike will fuel inflation further as commuting costs go up and add to the crushing burden on household budgets already stretched by soaring prices of essential food items.
However, the petroleum ministry said there was no way out as public sector oil companies were making huge losses because of skyrocketing crude prices in the international market, hovering at around $ 110 a barrel. Oil companies say the current depreciation of the rupee vis-a-vis the dollar has also pushed up crude import costs.
An Indian Oil Corporation (IOC) official said oil companies were losing Rs 2.61 per litre on petrol sales. After adding sales tax or VAT, a Rs 3.14 per litre hike would bring domestic prices in line with international prices of the fuel.
Besides petrol, the firms are losing Rs 263 crore per day on selling diesel, domestic LPG and kerosene at below market prices. Diesel is being sold with a subsidy of Rs 6.05 a litre, kerosene at Rs 23.25 per litre while domestic LPG is underpriced by Rs 267 per 14.2- kg cylinder. Read More
for detailed price charts.
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