Oil firms mulling another price hike

November 1st, 2011 - 7:38 pm ICT by IANS  

New Delhi, Nov 1 (IANS) State-owned oil companies may hike fuel prices once again owing to a depreciating rupee and rise in global crude prices.

“We are at present losing Rs.1.50 per litre on petrol. To make up for this loss a desired increase in retail price should be at least Rs.1.82 a litre,” B. Mukherjee, director-finance, Hindustan Petroleum Corporation Limited (HPCL) told reporters.

“We are in discussion with other oil companies on raising prices. We are toying with the idea,” he added.

According to Mukherjee, international prices of crude were hovering around $108 per barrel, while the rupee had depreciated from 46.50 a dollar three months ago to over 49 per dollar now which has resulted in an increase in the cost of oil imports.

HPCL posted a net loss of Rs.3,364 crore Tuesday. The average cost of the Indian basket of crude went up to $108.73 per barrel, rising from $103.63 a barrel during Oct 1-16.

When contacted, the country’s biggest oil retailer Indian Oil Corporation (IOC) told IANS that the company would not be able to comment whether it intended to raise price soon.

“I can’t say at this juncture, we will be having a meeting to discuss this,” said a senior official who did not wish to be named.

In September, the oil marketing firms had hiked petrol prices by Rs.5 per litre.

While petrol is de-regulated, giving oil marketing firms the freedom to change retail prices, they still require the government’s approval to effect any changes in prices of diesel, kerosene and cooking gas.

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