Date:14/08/2008 URL: http://www.thehindu.com/2008/08/14/stories/2008081460232200.htm

Business

Reduction in domestic fuel prices ruled out

Special Correspondent

NEW DELHI: Petroleum and Natural Gas Minister Murli Deora on Wednesday ruled out a reduction in domestic fuel prices, notwithstanding the continuing drop in international crude oil prices and the Indian crude basket coming down by almost 8 per cent in two months.

“The fall in prices of crude oil is a very positive and good sign. But … the Oil Marketing Companies (OMCs) are incurring massive losses due to under-recoveries at various levels,” Mr. Deora told reporters here.

Crude oil prices fell to around $113 a barrel this week from an all-time high of $147 last month. The basket of crude oil India buys averaged $109.88 a barrel, down from $119 a barrel on June 4 when petrol, diesel and domestic cooking gas prices were raised.

However, Oil Marketing Companies Indian Oil Corporation, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited continue to lose money on fuel sales, the Minister said.