New Delhi(IANS) : Faced with spiralling global oil prices and political opposition to raising transport and cooking fuel prices, India is likely to take a call next week, according to the petroleum minister.
“I cannot say 100 percent, but we will try to resolve it next week,” Petroleum Minister Murli Deora told reporters on the sidelines of the India-Africa Hydrocarbon Conference here Wednesday.
Deora is slated to meet Prime Minister Manmohan Singh Wednesday at a tea for conference participants.
“The government is very much alive to the problems. We are trying our best to resolve this problem as early as possible,” he said, adding: “We are considering various alternatives, including duty restructuring and increase in prices.”
The government has been in a dilemma on how to deal with a situation where oil majors are facing losses of over Rs.2 billion daily, but the ruling alliance feels a price hike will be politically damaging.
The government’s Left allies and chief opposition Bharatiya Janata Party are already prepared to criticise any fuel price hike.
Indian Oil Corp chairman Sarthak Behuria said his company’s under-recoveries of Rs.1.22 billion daily has a “tremendous impact on liquidity”.
“At current prices, our borrowings will top Rs.30 billion per month,” he said.
The Indian basket of crude was selling at $89 a barrel Wednesday, with the monthly average for Nov hovering around $78. Brent crude was selling at $94 a barrel Wednesday.
Chairman of Hindustan Petroleum Corp Ltd Arun Balkrishnan has suggested that prices of petrol and diesel should be increased by Rs.4-5 per litre, kerosene by Rs.17-18 per litre and LPG by Rs.200 per cylinder.
“Duty cuts would also help,” he told reporters.
Balakrishnan pointed out that companies with more refining capacity and less marketing were relatively less affected by record global prices.