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Cartel of INDIAN oil companies to increase their prices
Source: TNN REPORTS BETWEEN 2OTH MAY - 24TH MAY
Due to hike in the international oil prices of crude oil, INDIAN oil companies are facing huge losses
and therefore they are likely to increase the prices of premium petrol and premium diesel by RS.
2/litre. For this, they have been granted permission from petroleum ministry. The cartel of three
companies INDIAN OIL CORPORATION (IOC), BHARAT PETROLEUM CORPORATION (BPC) and
HINDISTAN PETROLEUM CORPORATION (HPC) are going to announce the hike very recently.
The director (finance) of BHARAT PETROLEUM CORPORATION says that the cartel of these oil firms
has a very limited option to finance the deficit. He again said that keeping in view of rising inflation,
the hike in petroleum price becomes very inevitable. The oil companies were interested in hiking of
ordinary petrol and diesel too, but the government did not give the consent. As per rules the cartel
of oil companies can alter the prices of only branded (premium) oil and not the ordinary oil.
According to petroleum Secretary Mr. SRINIVASAN, the growing deficit in oil sector cannot be
overlooked anymore. The data regarding this shows that during 2007-2008, the deficit of oil
companies was about RS. 80,000 CRORES, which has now crossed RS. 500 CRORES per day. Further if
the international oil prices are not reduced, then the deficit will be like RS. 2,00,000 CRORES.
Recently, the petroleum minister Mr. M. DEVRA me the cartel of four oil companies and discussed
with them about the oil prices and their deficits. The representatives of cartel urged the minister to
increase the prices of oil and reduce import duties on oil. The cartel re-iterated its demand of hike in
oil prices by RS. 5/litre and cut in import duty on oil by 5%. The minister assured the cartel of oil
companies that their will be forwarded to the prime minister and finance minister.
The cartel of oil companies were asked to not to be in a hurry to reduce the supply of petrol and
diesel and to decide about the quota of petrol pumps. In reply, the cartel argued that there is no sign
of reduction in prices of crude oil before September this year. The meeting of international cartel of
oil exporting nations (OPEC) is due in September 2008, following which OPEC can take the decision
of increasing oil production and that time the international prices of can go up to $150/barrel. In this
wake of this, it would be conducive to decide about the hike in oil prices very early.
In another front, the former governor of RBI and now the chairman of economic advisory council Dr.
C. RANGRAJAN accept that the recent time is challenging and critical for economical sector. He said
that that is challenging and critical for economical sector. He said that on one hand we are trying our
level best to reduce the high inflation; on the other hand, the prices of petroleum products are skyrocketing. These two are the factors which affect each other. He is of the opinion that cartel of oil
companies should face the challenge of this crisis and should adopt the suitable measures keeping in
view of increase in price by the cartel of OPEC internationally.