Petrol price hike was decision of oil marketing firms: Pranab -Governance Now

Petrol price hike was decision of oil marketing firms: Pranab

State-owned oil companies hiked petrol prices stating that depreciation of Rupee increased the cost of crude oil import

PTI | September 16, 2011

Amid resentment over sharp hike in petrol prices, the government on Friday distanced itself from the decision saying the call was taken by oil marketing firms.

"So far petrol price is concerned, petrol has been deregulated. It is oil marketing companies' review," finance minister Pranab Mukherjee said when asked about Rs 3.14 per litre hike.

He was talking to the reporters after launching 'Land of Two Rivers', a book written by Nitish Sengupta in national capital.

On Thursday the state-owned oil companies hiked petrol prices stating that depreciation of Rupee increased the cost of crude oil import. This is the second major hike in four months. In May, petrol price was increased by Rs 5 per litre.

While the UPA ally Trinamool Congress has already demanded a rollback in the hike, CPI(M) termed it as "callous" and demanded restoration of the administrative regulation of petrol pricing.

The CPI(M) said that the petrol price hike comes at a time when inflation is touching double digits and this would only have a cascading effect on price rise.

The RBI in its monetary policy on Friday said that the petrol price hike would push WPI inflation up by 7 basis points, besides having cascading effect.

Petrol prices were freed from the government control in June last year.

Related Story

CPI(M) demands immediate roll back of fuel price hike

Terming the government's move to hike petrol prices as "callous", the CPI(M) on Friday demanded immediate roll back of the hike and restoration of the administrative regulation of petrol pricing.

Condemning the hike of petrol price by Rs 3.14 per litre in Delhi, the party politburo said this was the third increase this year which "comes at a time when inflation is touching double digits and the people have no respite from the price rise of essential commodities. This callous move will only have a cascading effect on inflation and price rise."

"The people can see that the Congress-led government is itself responsible for stoking price rise and inflation by such measures," the CPI(M) said, demanding the cancellation of this price rise and restoring the administrative regulation of pricing of petrol.

Party general secretary Prakash Karat said the repeated increases in petrol prices "shows how callous the UPA government has become".

"The deregulation of petrol prices is already having a cascading effect while the UPA government has been consistently refusing to rationalise the tax structure on petroleum prices," he said.

Badal demands roll back of petrol price hike

Punjab chief minister Parkash Singh Badal on Friday slammed the Congress-led UPA government at the centre for effecting "totally unjustified" and "back breaking" hike in petrol price.

"The totally unwarranted hike in petrol prices will not only break back of the already suffering common man, but will also dampen economy and further slow down growth rate," Badal said in a statement in Chandigarh.

CM said that inflation was very high and has gone beyond the control of the UPA government despite its tall claims to manage it.

The hike would adversely affect the transport sector in the state resulting in corresponding price rise of essential commodities, he said.

Badal asked the Centre to evolve a transparent system to decide the prices of petroleum products in consultation with all the political parties.

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