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‘India may have to hike fuel prices again’

New Delhi: India may have to increase fuel prices again as global crude prices continue to rise, says credit rating agency Moody’s.

“As global prices continue to soar, the government will likely announce further increases in energy prices and cuts in subsidies,” said a report by Moody’s Economy.com, an associate of Moody’s.

After much dilly-dallying, the government earlier this month hiked the price of petrol by Rs.5 a litre, diesel by Rs.3 a litre and LPG by Rs.50 a cylinder to help oil marketing companies to partly meet their under recoveries because of surging global crude prices. The government still gives Rs.300 subsidy on a gas cylinder.

The government had to face an all-round criticism for its move to raise petrol prices and Prime Minister Manmohan Singh had to address the nation to explain the rationale for the increase.

Following his appeal, many States cut sales tax on petroleum products to blunt the impact of fuel price hike.

Global crude oil prices were ruling above $138 a barrel on Thursday. — PTI

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