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Oil firms seeks right to revise LPG prices
Pradeep Puri in New Delhi |
June 10, 2003 11:28 IST
Four state-owned oil marketing companies have decided to make a representation to the government regarding the denial of their right to revise the retail selling prices of liquefied petroleum gas used for domestic purposes and kerosene sold through the public distribution system.
By a gazette notification issued early this year, the government had allowed Indian Oil Corporation, Bharat Petroleum Corporation Ltd, Hindustan Petroleum Corporation Ltd and IBP to revise the retail selling prices of these two subsidised petroleum products as per a scheme worked out for the purpose.
However, for more than a year now, these companies have been prevented from revising the prices of these two fuels, resulting in Rs 5,430 crore (Rs 54.3 billion) under-recoveries to the oil firms in 2002-03.
The international prices of liquefied petroleum gas had increased from $227.75 a tonne to $280.40 a tonne during 2002-03.
As per the scheme notified in the gazette, the companies are allowed to make changes in the issue price of kerosene through the public distribution system and domestic liquefied petroleum gas on their own if the cost price of the two commodities change.
The cost price may change because of changes in the product price in the international market, ocean freights and inland freights. The price may also change due to any change in the rate of Customs duty or changes in marketing margins.
The notification clearly states that the companies may change the retail selling prices of these two commodities if there is a change in the issue price.
Moreover, the notification says that the retail selling prices of the petroleum products can also change if changes are made in the commissions of dealers or distributors, or if there is a change in the rate of statutory levies like excise duty, sales tax, entry tax or octroi.