IOC may hike petrol prices again next month

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3 Nov 2010
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State-owned Indian Oil Corporation (IOC), the nation's largest fuel retailer, today said it may hike petrol price next month as the steep hike of Rs 5 per litre of May 15 was not enough to cover for the cost of crude oil.

"Even after the hike, we are today losing Rs 4.58 per litre. After including VAT, the desired increase at retail level comes to Rs 5.50 a litre," IOC Chairman RS Butola told reporters here.

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The desired hike in price has been calculated based on the average crude oil price of the first fortnight of May. However, from June 1, which will take into account the average of second half of May when international rates moderated, IOC will lose Rs 1.15 per litre. After including VAT, the desired hike in Delhi would be Rs 1.35 a litre.

"We will have to take a view [on hiking petrol price] soon," he said. "The government is not compensating us for selling petrol at below international cost since June 2010 when its pricing was freed."

Butola, however, refused to say when the rates will go up. "We will have to consider the environment we operate in before taking that call."

On diesel, he said, the company will from June 1 expected to lose Rs 12.64 per litre. It currently loses Rs 14.66 a litre on diesel.

Similarly, on domestic LPG it is losing Rs 380.57 per cylinder and Rs 25.85 a litre on PDS kerosene.

An Empowered Group of Ministers (EGoM) headed by Finance Minister Pranab Mukherjee is likely to meet on June 9 to consider raising prices of the three controlled commodities -- diesel, domestic LPG and kerosene.
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