Petrol prices hiked by ' 3.14 per litre
Source: Hueiyen News Service
New Delhi, September 15 2011:
State-owned oil firms raised petrol prices by Rs 3.14 per litre as the rupee touched two-year low against the US dollar, increasing the cost of importing crude oil.
The hike will be effective from midningt.
Indian Oil (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) had last raised petrol price by Rs 5 a litre in May.
Diesel, domestic LPG and kerosene price were hiked in June by Rs 3 per litre, Rs 50 per cylinder and Rs 2 per litre.
Separately, an Empowered Group of Ministers headed by finance minister Pranab Mukherjee is likely to consider tomorrow limiting supply of subsidised LPG cylinders to 4-6 per household in a year.
The government had in June last year decontrolled petrol price but continues to dictate diesel, domestic LPG and kerosene rates.
However, petrol price has not moved in tandem with its cost, keeping in mind the government's concerns on inflation which climbed to 9.78 percent in August.
"The losses on the four products have meant that oil companies borrowed to meet even their working capital requirement," the official said.
The combined borrowing levels of the oil marketing companies has increased from Rs 96,700 crore in March 2011 to Rs 120,000 crore in August 2011."The increase is mostly towards short term borrowings to fund working capital requirements," he said.
The basket of crude oil that India buys had averaged USD 85.09 per barrel in 2010-11.From April-September, it has averaged USD 111.64 per barrel, a 31 per cent increase over the last fiscal (2010-11).The Indian basket of crude oil averaged USD 106.94 per barrel in August and USD 110.88 a barrel in September.