As the country prepares to switch over to the Euro IV standard fuel regime from April 1, 2010, petrol prices in Delhi and Mumbai and 12 other metro cities are likely to be increased by Rs.0.41 a litre and diesel by Rs.0.26 a litre from the same day, Petroleum Secretary S. Sundareshan said on Wednesday.
As a massive investment has been made for upgradation to the present fuel standards, the Petroleum Ministry wants that the oil marketing companies (OMCs) should not suffer any further losses. “This Rs.0.41 a litre hike needed in petrol price and Rs.0.26 per litre in diesel rates is not on the basis of Rs.40,000-crore capital expenditure oil firms incurred in upgrading their facilities to produce cleaner fuel but a requirement to bring domestic rates to international parity,” Mr. Sundareshan said at the launch of Euro-IV supplies here. Petroleum and Natural Gas Minister, Murli Deora, Minister of State for Petroleum and Natural Gas Jitin Prasada and Delhi Chief Minister Sheila Dikshit were present on the occasion.
The actual price hike needed to cover the cost would have been 3-4 times the proposed increase. Oil firms will sell ultra-low sulphur petrol and diesel in 13 major cities from April 1, while Euro-III grade fuel is to be supplied only in the rest of the country.
Like the cost of shifting from Euro-III to Euro-IV in 13 big cities, a marginal increase in petrol and diesel prices is also proposed in the rest of the country which would move from Euro-II grade auto fuel to Euro-III specification.
However, the quantum of price hike for Euro-III fuel has not been finalised as yet.
Mr. Sundareshan also hinted at some harsh decisions to prevent revenue loss on auto and cooking fuels from rising to Rs.70,000 crore next fiscal from Rs.47,960 crore this year. “Under-recoveries will rise if we do not take very, very hard decisions soon,'' he said, indicating his Ministry's inclination for an increase in petrol and diesel prices.
Countering arguments that fuel prices led to inflation, he said the government borrowings, to mostly fund subsidies, was responsible to a greater degree for the rise in prices. If fuel prices are not raised further, 2010-11 will see under-recoveries (revenue loss) on fuel sales rising to Rs.70,000 crore, he said.
Showing posts with label fuel prices. Show all posts
Showing posts with label fuel prices. Show all posts
Thursday, March 25, 2010
Thursday, March 4, 2010
DMK softens stand on fuel price hike
The DMK on Thursday said that its alliance with the Congress is like “two bulls” of a bullock cart, suggesting thereby the softening of its stand on the government’s decision to hike prices of fuels.
“Two bulls taking the bullock cart in the right direction,” DMK Leader in Rajya Sabha T. Siva said, referring to his party’s alliance with the Congress. Mr. Siva was speaking in support of the Motion of Thanks to the President’s address.
DMK chief M. Karunanidhi was reported to have sent a letter to the Prime Minister opposing the fuel price hike. As Finance Minister Pranab Mukherjee made changes in the customs and excise duties in the 2010-11 Budget, petrol price increased by Rs 2.71 a litre and diesel by Rs 2.55 a litre.
Mr. Siva praised the UPA government for developments taking place in the country and said, “The U.S. is scared of developments taking place in India.” He said the pessimism of the Opposition on India’s growth story is out of place.
“Two bulls taking the bullock cart in the right direction,” DMK Leader in Rajya Sabha T. Siva said, referring to his party’s alliance with the Congress. Mr. Siva was speaking in support of the Motion of Thanks to the President’s address.
DMK chief M. Karunanidhi was reported to have sent a letter to the Prime Minister opposing the fuel price hike. As Finance Minister Pranab Mukherjee made changes in the customs and excise duties in the 2010-11 Budget, petrol price increased by Rs 2.71 a litre and diesel by Rs 2.55 a litre.
Mr. Siva praised the UPA government for developments taking place in the country and said, “The U.S. is scared of developments taking place in India.” He said the pessimism of the Opposition on India’s growth story is out of place.
Sunday, February 28, 2010
Hike in fuel price to make food costlier
Consumers who felt relieved with the prices of essential commodities coming down in the recent past are worried again. Due to the hike in the prices of petroleum products, prices of essential commodities are likely to shoot up again.
Traders say the prices of pulses, rice and other essentials are set to increase in the coming weeks. The Greater Hyderabad Dal Millers and Wholesale Traders’ Association estimates that the hike in diesel prices will impose a burden of Rs 200 per quintal on pulses. This will further go up by the time the product reaches consumers through retailers.
“In the recent past, pulses were available at affordable rates due to an increase in production. The prices are likely to go up again because of the burden of transport charges,” said Mr Rajendra Kimtee, the president of the association.
Currently, red gram is available at Rs 58 per kg in the wholesale markets, black gram costs Rs 66 per ky and green gram Rs 79 per kg. Rice prices, which fell by 25 per cent recently, too are set to go up. The state government’s Rs 2 per kg rice scheme is going to be affected as well.
The APSRTC too is going to feel the pinch. The corporation has to bear an additional burden of Rs 160 crore with the hike in diesel prices.
The RTC, which spends Rs 1,500 crore every year for purchase 55 crore litres of diesel, is anticipating a financial crisis in the days to come. However, the officials have decided not to revise the RTC fares and pass on the burden to commuters.
About five lakh lorry owners too are on a warpath. Lorry owners say they are not in a position to bear an additional burden of Rs 2.5 per litre on diesel. Also, the prices of vehicles, including lorries, will go up with the increase in excise duty. Lorry prices are likely to go up by nearly Rs 50,000. Cost of tyres and spare parts will increase as well.
Traders say the prices of pulses, rice and other essentials are set to increase in the coming weeks. The Greater Hyderabad Dal Millers and Wholesale Traders’ Association estimates that the hike in diesel prices will impose a burden of Rs 200 per quintal on pulses. This will further go up by the time the product reaches consumers through retailers.
“In the recent past, pulses were available at affordable rates due to an increase in production. The prices are likely to go up again because of the burden of transport charges,” said Mr Rajendra Kimtee, the president of the association.
Currently, red gram is available at Rs 58 per kg in the wholesale markets, black gram costs Rs 66 per ky and green gram Rs 79 per kg. Rice prices, which fell by 25 per cent recently, too are set to go up. The state government’s Rs 2 per kg rice scheme is going to be affected as well.
The APSRTC too is going to feel the pinch. The corporation has to bear an additional burden of Rs 160 crore with the hike in diesel prices.
The RTC, which spends Rs 1,500 crore every year for purchase 55 crore litres of diesel, is anticipating a financial crisis in the days to come. However, the officials have decided not to revise the RTC fares and pass on the burden to commuters.
About five lakh lorry owners too are on a warpath. Lorry owners say they are not in a position to bear an additional burden of Rs 2.5 per litre on diesel. Also, the prices of vehicles, including lorries, will go up with the increase in excise duty. Lorry prices are likely to go up by nearly Rs 50,000. Cost of tyres and spare parts will increase as well.
