ID :
34230
Sat, 12/06/2008 - 16:37
Auther :
Shortlink :
http://m.oananews.org//node/34230
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Petrol price slashed by Rs 5, diesel by Rs 2 a litre
New Delhi, Dec 5 (PTI) The Indian government Friday announced a Rs 5 and Rs 2 a litre interim cut in petrol and diesel prices, respectively, in a move that will help put the lid on inflation and foster economic growth.
Indicating that further cuts were in the offing, India's Petroleum Minister Murli Deora told reporters after a meeting of the Cabinet Committee on Political Affairs that today's reduction was an "interim measure" and that the government would continue to watch the global prices of crude oil.
Following the reduction that takes effect midnight tonight, petrol will cost Rs 45.62 a litre and diesel Rs 32.86 in the national capital. There is no change in the prices of LPG (cooking gas) and kerosene.
The government had in June raised the prices of petrol and diesel by Rs 5 and Rs 3 a litre, respectively, and that of LPG by Rs 50 a cylinder to protect oil marketing firms against losses on account of a rally in crude prices.
The hike had then propelled inflation to double digits
and stayed so for five months. Inflation cooled to 8.40 per
cent as of November 22, but is still above the RBI's tolerance
level.
Crude oil subsequently climbed to a record high of USD
147 a barrel in July, but has now come to USD 43.5, a four-
year low.
"This (price cut) will help in reducing inflation," Deora
said, adding that Prime Minister Manmohan Singh and Congress
President Sonia Gandhi were committed to protecting the
interests of the poor and middle-class.
Tomorrow, RBI is expected to ease its monetary policy
make borrowings cheaper, increase spending and push economic
growth.
The government too will tomorrow announce a fiscal
stimulus for the housing, auto and export sectors, as also
support for infrastructure sector to prop up GDP growth that
is threatened by the global slowdown as also poor investor
confidence following last week's terror attacks in Mumbai.
Friday's fuel cut decision will have a revenue
implication of Rs 57980 million for oil marketing companies
this fiscal.
Under-recoveries of OMCs as of today were calculated at
Rs 98,512 crore and this will now increase to Rs 1,04,310
crore.
Prior to the reduction, state-run oil firms were earning
a profit of Rs 14.89 a litre on petrol and Rs 3.03 on a litre
of diesel. However, they continue to sell kerosene at a loss
of Rs 17.26 a litre and Rs 148.89 on every LPG cylinder.
Despite the oil companies losing close to Rs 27 a litre
on kerosene, its prices have not been raised, Deora pointed
out.
"India is the only country in the world where kerosene is
cheaper than mineral water," he said. Kerosene is retailed at
Rs 9.09 a litre. PTI
Indicating that further cuts were in the offing, India's Petroleum Minister Murli Deora told reporters after a meeting of the Cabinet Committee on Political Affairs that today's reduction was an "interim measure" and that the government would continue to watch the global prices of crude oil.
Following the reduction that takes effect midnight tonight, petrol will cost Rs 45.62 a litre and diesel Rs 32.86 in the national capital. There is no change in the prices of LPG (cooking gas) and kerosene.
The government had in June raised the prices of petrol and diesel by Rs 5 and Rs 3 a litre, respectively, and that of LPG by Rs 50 a cylinder to protect oil marketing firms against losses on account of a rally in crude prices.
The hike had then propelled inflation to double digits
and stayed so for five months. Inflation cooled to 8.40 per
cent as of November 22, but is still above the RBI's tolerance
level.
Crude oil subsequently climbed to a record high of USD
147 a barrel in July, but has now come to USD 43.5, a four-
year low.
"This (price cut) will help in reducing inflation," Deora
said, adding that Prime Minister Manmohan Singh and Congress
President Sonia Gandhi were committed to protecting the
interests of the poor and middle-class.
Tomorrow, RBI is expected to ease its monetary policy
make borrowings cheaper, increase spending and push economic
growth.
The government too will tomorrow announce a fiscal
stimulus for the housing, auto and export sectors, as also
support for infrastructure sector to prop up GDP growth that
is threatened by the global slowdown as also poor investor
confidence following last week's terror attacks in Mumbai.
Friday's fuel cut decision will have a revenue
implication of Rs 57980 million for oil marketing companies
this fiscal.
Under-recoveries of OMCs as of today were calculated at
Rs 98,512 crore and this will now increase to Rs 1,04,310
crore.
Prior to the reduction, state-run oil firms were earning
a profit of Rs 14.89 a litre on petrol and Rs 3.03 on a litre
of diesel. However, they continue to sell kerosene at a loss
of Rs 17.26 a litre and Rs 148.89 on every LPG cylinder.
Despite the oil companies losing close to Rs 27 a litre
on kerosene, its prices have not been raised, Deora pointed
out.
"India is the only country in the world where kerosene is
cheaper than mineral water," he said. Kerosene is retailed at
Rs 9.09 a litre. PTI
