Since international oil prices have fallen, the government's subsidy payout will fall by almost Rs 50 per cylinder to Rs 240.
In three reductions, the price of non-subsidised cooking gas has been cut by Rs 277 per 14.2-kg cylinder.
A CNN-IBN Urban India Ooinion Poll shows the recent economic reform move of the government has not gone down well with the urban India. The poll shows that while the price rise and corruption remain the major concerns for the urban India, there is also a massive anger over cap on LPG subsidy and diesel price hike among the people across the cities.
Cooking gas price was on Saturday hiked by Rs 11.42 per cylinder following government decision to raise commission paid to the dealers.
The price of subsidised cooking gas was on Tuesday hiked by over Rs 2 per cylinder, the sixth increase in rates in five months, while that of jet fuel was raised by a steep 7.3 per cent in step with global trends.
The increase in petrol price, which the oil firms had been holding since January even though crude oil had touched a two-and-a-half-year high, came a day after election results of five state assemblies were announced.
Facing stiff opposition, the government tonight put on hold the Rs 26.5 increase in price of cooking gas cylinders that consumers buy beyond their quota of six subsidised bottles.
With Congress party vice president Rahul Gandhi making a strong pitch for raising LPG cap, Oil Minister M Veerappa Moily on Friday said the quota of subsidised cooking cylinders will be hiked to 12 from 9 per household.
India's fuel sales fell in the first half of April as a record rise in prices in a short 16-day period dented demand, preliminary industry data showed on Saturday. Petrol sales fell almost 10 per cent in the first half of April when compared with the same period in the preceding month, while diesel demand slid 15.6 per cent. Even cooking gas LPG, which had consistently shown growth even during the pandemic period, saw a 1.7 per cent month-on-month fall in consumption during April 1-15.
The expert group was tasked to suggest a methodology for pricing of diesel and cooking fuel.
The government on Friday decontrolled petroleum prices to bring fuel costs in line with global oil rates after an Empowered Group of Ministers, headed by Finance Minister Pranab Mukherjee, met for the second time in less than three weeks to decide on raising fuel prices. Railway Minister Mamata Banerjee was absent again.
Finance Minister Pranab Mukherjee asked all chief ministers to reduce state levies on diesel, kerosene and cooking gas to mitigate the impact of the price hike on the common man.
State-owned fuel retailers are losing close to Rs 3 per litre on selling diesel while the profit on petrol has trimmed due to recent firming up in international oil prices, industry officials said detailing reasons for continuing to hold retail prices. Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL), who control roughly 90 per cent of India's fuel market, 'voluntarily' have not changed petrol, diesel and cooking gas (LPG) prices for almost two years now, resulting in losses when input cost was higher and profits when raw material prices were lower.
According to reports, the price of petrol is expected to go up by Rs 5 and diesel by Rs 6.
An increase in petrol, diesel, domestic cooking gas (LPG) and kerosene prices looks "imminent" after the Finance Ministry said it has no money to provide for fuel subsidy.
Petroleum Minister Ram Naik on Monday said the hike in petrol and diesel prices was "justified" given the hardening of global crude prices.
Petrol and diesel prices will go by Rs 2.50 and Rs 2 per litre respectively.
Prices of food items like cereals, pulses, and edible oils rose or remained steady in May, a Reserve Bank of India (RBI) report said, indicating there could be another higher inflation print. However, it observed that the Monetary Policy Committee's (MPC's) surprise move to increase interest rates bodes well for its credibility. The RBI's monthly State of the Economy report, released on Tuesday, citing high frequency food price data from the Ministry of Consumer Affairs for the period May 1-12, said the increase in the prices of cereals was primarily because of the surge in wheat prices.
Despite the increase, at Rs 64.32 per litre ATF costs less than petrol and diesel.
In absolute terms, prices will go up by Rs 5,500 to Rs 47,000, depending on the model and prevailing prices.
Congress president Mallikarjun Kharge has accused the BJP of rigging the Maharashtra assembly elections and called for a return to ballot paper voting. He also criticized the Modi government for selling off public assets, undermining democratic institutions, and promoting communal polarization. Kharge's remarks come as the Congress prepares for its AICC session in Ahmedabad, where it will present its political and economic views.
In the Upper House of Parliament, Chairman M Venkaiah Naidu did not allow adjournment notices moved by opposition members on the issue of price rise, prompting members of the Congress, the Trinamool Congress, the Left parties, the Dravida Munnetra Kazhagam, the Aam Aadmi Party, the Nationalist Congress Party, the Rashtriya Janata Dal and the Shiv Sena to create an uproar.
Cement, coal, steel and urea prices are likely to go up
Congress General Secretary Digvijay Singh on Sunday said in Bhopal that rising inflation is a major problem but it was necessary to hike prices of petroleum products because of the international situation.
Prime Minister Manmohan Singh on Tuesday said that diesel prices too will be freed from government control as part of 'much-needed reforms', but LPG and kerosene will continue to be subsidised.
The government on Thursday more than doubled the price of natural gas that is used to produce electricity, make fertilisers, turned into CNG and piped to household kitchens for cooking, on the back of a spike in global energy prices. The price of gas produced from old regulated fields, such as the nation's largest gas field of Bassein of ONGC, will rise to a record high of $6.10 per million British thermal unit (mmBtu) from the current $2.90 per mmBtu, according to the oil ministry's Petroleum Planning and Analysis Cell (PPAC). The new price, which is likely to result in a hike in CNG and piped cooking gas rates, will be for six months beginning April 1.
The ministry is preparing a draft note for consideration of the CCPA on pricing of diesel, kerosene and LPG, official sources said.
Diesel prices should be immediately hiked by Rs 4-5 per litre, the Kirit Parikh Committee has recommended while favouring continuation of existing pricing principles for controlled petroleum products.
Petrol and diesel prices are unlikely to be hiked in the near future, with Finance Minister P Chidambaram agreeing in-principle to share a third of the revenue loss that state-run oil firms incur on sale of fuel
Diesel in Mumbai costs Rs 79.72 per litre at IOC outlets and Rs 79.79 at BPCL outlets.
Making a case for raising prices of diesel, kerosene and LPG, the Reserve Bank on Tuesday said hike in rates of petroleum products is necessary to arrest fiscal slippages.
The average price of Indian basket of crude oil during 2007-08 (upto August) has increased to $68.34 per barrel as compared to 62.46 dollars a barrel during 2006-07.
The government on Thursday said it will "look into" a demand to raise the quota of subsidised LPG cylinders to 12 per household in a year from the current limit of nine, a day after the price of non-subsidised LPG was increased by a steep Rs 220.
The rates are hikes by almost 8 per cent.
The Oil Ministry has proposed a Rs 3-4.50 per litre hike in diesel price and Rs 100 in LPG rates along with raising the number of subsidised cooking gas cylinders for households to nine a year from the current cap of six.
Government needs to rethink its over-dependency on imported petrol, and come up with ways to stabilise the Indian rupee.
With Indian Oil, Hindustan Petroleum and Bharat Petroleum projected to lose Rs 200,000 crore (Rs 2,000 billion) in revenues on sale of petrol, diesel, domestic LPG and kerosene below import cost, industry sources said a hike in the range of Rs 2 to 5 per litre appears on the cards.
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