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Rediff.com  » Business » Oil cos not to cut petrol price today

Oil cos not to cut petrol price today

June 15, 2012 19:48 IST
Belying expectations, petrol prices will not be cut on Friday despite there being a scope for reducing the rates by up to Rs 1.60 a litre.

State-run oil companies, as per practice, were to revise petrol price today based on the average international oil price and rupee-dollar exchange rate in the previous fortnight.

"I do not think there is any news today," a top official at one of the oil marketing companies said.

No reason was assigned for skipping the fortnightly revision, but sources linked the decision to the absence of Oil Minister S Jaipal Reddy in the capital. Reddy is Vienna attending the OPEC Ministerial meeting and is likely to return on Saturday.

R S Butola, Chairman of Indian Oil Corp (IOC), the company which spearheads revision in rates of petrol, too is travelling with Reddy.

Oil firms informally consult their parent ministry before revising prices. Indian Oil, Hindustan Petroleum and Bharat Petroleum had over the past one week indicated of a scope of reducing rates from June 1.

Oil firms had last cut petrol rats by Rs 2.02 a litre with effect from June 3 in a partial rollback of the steep Rs 7.54 per litre hike effected last month.

Petrol at present costs Rs 71.16 a litre in Delhi. Sources said the last revision in rates was done keeping the average of $115.77 per barrel average rate of gasoline, against which domestic petrol prices are benchmarked. Gasoline rates have since fallen to about $109 per barrel.

But rupee-dollar rate has worsened to Rs 55.50 as against Rs 54.96 at the time of last revision. This give a scope for cutting rates by up to Rs 1.60 a litre (excluding local sales tax).

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