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Bharat Petroleum Corporation (BPCL) on Tuesday hiked petrol prices by about Rs 2.96 a litre effective midnight tonight, and other state-owned oil companies IOC and HPCL will follow suit on Wednesday.

The oil ministry on Tuesday gave the three companies a go-ahead to raise petrol prices after international crude oil prices touched $90 per barrel.

BPCL, the second largest fuel retailer in the country, took the lead to raise petrol prices by Rs 2.96 a litre to Rs 55.87 per litre in Delhi, sources privy to the decision said.

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Indian Oil Corp (IOC), the largest fuel retailer in the country, and Hindustan Petroleum Corp (HPCL) will do the same by an equal measure tomorrow, sources said.

State-run oil companies are taking turns to increase prices so that they are not accused of acting as a cartel in revising price of a commodity which had been freed from government control.

Sources added that the three are losing about Rs 4.17 per litre on selling petrol below import cost.

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Sources said a Rs 2 per litre hike in diesel prices is on the agenda of an Empowered Group of Minister headed by Finance Minister Pranab Mukherjee when it meets on December 22.

The oil firms are losing Rs 5.40 per litre on selling diesel below import cost, sources said. Even though the government had decontrolled petrol prices in June, state-run retailers continue to informally consult the oil ministry before revising the rates.

They had on November 9 raised petrol prices by Rs 0.32 per litre to Rs 52.91 a litre in Delhi.

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IOC, BPCL and HPCL have revised rates only four times since June 26 when petrol price was deregulated, while crude oil has jumped from $73-74 per barrel at that time to $90 a barrel now, sources said.

After today's increase, petrol prices have gone up by Rs 4.44 a litre since deregulation. The basket of crude oil India buys was at $ 89.34 per barrel on Monday.

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It has averaged $88.47 per barrel in December as against about $79 a barrel at the time of last hike in petrol price on November 9.

If prices are not revised, IOC, BPCL and HPCL are likely to end the fiscal with close to Rs 67,000 crore (Rs 670 billion) revenue loss on sale of diesel, domestic LPG and kerosene below cost.

The oil retailers lose Rs 272.19 on the sale of every 14.2-kg LPG cylinder and Rs 17.72 per litre of kerosene.