New Delhi, Dec 14 (PTI): Petrol prices may be hiked by Rs 0.65 per liter this week if state-owned oil firms manage to get political approval for the move.
While a fall in the rupee to an all-time low of Rs 53.75 per US dollar has resulted in an increase in the cost of oil imports, international rates of gasoline -- against which domestic petrol prices are benchmarked -- have also increased, a top source at a state-run oil firm has said.
"The under-recovery on petrol is Rs 0.55-0.56 per litre. After adding local sales tax, the desired increase in Delhi comes to Rs 0.65-0.66 a litre," he said, adding that the oil companies will review prices tomorrow and any change will be effective from December 16.
State-owned oil firms have cut petrol prices on two occasions in the past one month after international oil rates eased. The companies reduced petrol prices by Rs 2.22 per litre, or 3.2 per cent, from November 16 and followed this with a Rs 0.78 per litre cut from December 1.
The source, however, could not say if oil companies will go ahead with increasing prices tomorrow, in line with the practice of changing rates every fortnight. "The actual loss to us is only 50-55 paise. We can tolerate it for another fortnight if need be," he said.
Public sector oil firms, which revise petrol prices on the 1st and 16th of every month based on the average international rates of the previous fortnight, may informally consult the parent Petroleum Ministry before taking a decision. Parliament is in session and an increase in petrol prices may lead to protests by Opposition parties.
The price of gasoline has averaged USD 111.11 per barrel in Singapore this month, up from USD 108.25 a barrel in the previous fortnight.