Prime Minister Manmohan Singh on Monday expressed concern at the rise in international oil prices and said that all possible options, including a fuel price hike and duty cuts, will be considered to deal with the situation.

"We have to look at all possibilities existing. I would not like to comment on it," he told reporters when asked if petrol and diesel prices are set to be raised.

"Steep rise in crude oil prices is a cause of concern. We have to look at various options open to us," he said after new CAG Vinod Rai took oath of office at Rashtrapati Bhawan.

A Group of Ministers on fuel prices headed by External Affairs Minister Pranab Mukherjee will meet on January 17, the first ever meeting after its constitution by the Prime Minister in November 2007, to consider a response to crude prices touching USD 100 a barrel.

The crude prices have since fallen back, but are a cause of worry to India, which meets three-fourth of its demand through imports. With state retailers Indian Oil [Get Quote], Bharat Petroleum and Hindustan Petroleum together losing Rs 340 crore (Rs 34 billion) every day on sale of petrol, diesel, domestic LPG and PDS kerosene at prices below the imported cost, a hike in fuel prices and a cut in excise duty are being mooted as options.

Petroleum Minister Murli Deora said the GoM on fuel prices will meet on January 17 to consider all 'options' but refused to elaborate. While 42.7% of the under-realisation on fuel sale is met by Government through issue of oil bonds and one-third by assistance from upstream companies like ONGC [Get Quote], options for neutralising the balance one-fourth of revenue loss are being explored.

The current price of Indian basket of crude oil is higher by around 22-23 dollars a barrel over the international price prevailing at the time of last increase in petrol and diesel prices on June 6, 2006.

Indian Oil, Bharat Petroleum and Hindustan Petroleum are projected to lose Rs 69,753 crore (Rs 697.53 billion) on sale of petrol, diesel, domestic LPG and PDS kerosene, as the government has not allowed them to raise prices in line with the price of imported crude.

Petrol is being sold at a loss of Rs 8.74 a litre, diesel at Rs 9.92 per litre, kerosene Rs 20.53 a litre and LPG at a loss of Rs 256.35 per cylinder.