Petroleum Minister Murli Deora on Tuesday said petrol and diesel prices will not be increased "as of now" even as he began consultations with Finance Minister P Chidambaram on ways of mitigating the spurt in global oil prices.

"Not as of now," was Deora's reaction when asked if the government was mulling a Rs 2 per litre hike in petrol and Re 1 a litre raise in diesel prices.

Public sector oil firms are losing about Rs 170 crore (Rs 1.7 billion) per day on sale of petrol, diesel, domestic LPG and kerosene as the government has not allowed them to raise fuel prices in step with rise in cost.

Indian basket of crude oil has risen more than 12 per cent since February when petrol and diesel were cut by Rs 2 a litre and Re 1 per litre respectively.

"We are closely monitoring the situation," Deora said adding his ministry would continue discussions with Chidambaram on ways to mitigate the Rs 50,700 crore (Rs 507 billion) under-realisation expected on petrol, diesel, domestic LPG and kerosene in 2007-08.

Indian Oil [Get Quote], Bharat Petroleum and Hindustan Petroleum are losing Rs 4.97 a litre on petrol and Rs 4.45 per litre on diesel. The loss on sale of kerosene through the public distribution system is Rs 14.63 per litre and on LPG is Rs 189.14 per cylinder.

Official sources said Deora met Chidambaram this morning to discuss the quantum of oil bonds the finance ministry should issue to oil firms to partly compensate them for the loss on fuel sales.

At least one-third of the under-recovery on fuel sale is being sought to be met through the bonds and a similar quantum would be met by discounts from upstream firms like Oil and Natural Gas Corp and Gas Authority of India Ltd.