Jan. 20: The change of guard at the oil ministry seems to have put the diesel price deregulation on the backburner. With the new steward of the sector that accounts for the maximum turnover in the Indian economy, Mr S. Jaipal Reddy, has ruled out a price hike in the near future.
The government had in June last year decided to make petrol prices market-determined and had stated that diesel rates will be freed from control in due course. “I don’t think anybody can take such a long-term decision,” he said, referring to the cascading effect that such a move will have on inflation and the country’s economic growth.
State-owned oil firms Indian Oil, Hindustan Petroleum and Bharat Petroleum are losing about Rs 7 on sales of every litre of diesel and have been pressing for a price hike. When asked about petrol, whose rates have been raised seven times since June last year, the newly appointed oil minister said there will be no rollback in the prices, though he did indicate there will be no hike either.