Petrol and diesel prices, in keeping with the current practice of fixing prices on 1st and 16th of every month, are due to be reviewed on Wednesday, but may not be lowered in line with the fall in international prices.
"The mistake of September 1997 when the first step of dismantling the administered pricing mechanism was taken and that of April 2002 when the APM was dismantled will not be repeated," he said.
"At that time the steep fall in international prices and the spurt like that witnessed in 2004 was not taken into account. We have to consider all these volatilities for evolving a stable pricing policy," he added.
Aiyar refused to say if the public sector oil firms would slash petrol and diesel prices in step with the decline in international prices.
"When the prices rose we did not raise (domestic prices) to the levels required. We want normal situation to prevail in the international market for us to evolve a stable pricing policy," he said.
The UPA-government is averse to making frequent changes in fuel prices.
Diesel prices will have to be cut by over a rupee per litre and petrol by Rs 0.40 a litre if domestic prices are to move in tandem with international markets, where crude and product prices have fallen sharply.
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