The government can consider slashing domestic fuel prices when international crude oil prices stabilise, said Union Minister of Petroleum and Natural Gas Hardeep Singh Puri on March 9.
However, given the ongoing crisis in the Red Sea and geopolitical tensions, a reduction in fuel prices seems unlikely for the Oil Marketing Companies (OMCs), said Puri in a press conference.
“If crude oil prices remain stable, a cut in fuel prices is something that can be looked at as we go along,” the oil minister said.
State-run OMCs including the Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (BPCL) revise domestic fuel prices based on international oil prices.
However, fuel prices have been left unchanged since May 2022, despite crude oil prices trading around $80 per barrel currently, compared to $140 per barrel in March 2022.
With the upcoming general elections in the country, the consumers were looking forward to a reduction in petrol and diesel prices.
Puri reminded that the OMCs had incurred huge losses when crude prices had skyrocketed amid the Russia-Ukraine war. The oil companies are still facing under-recovery on the sale of diesel, he told reporters.
The minister also highlighted that crude oil prices have majorly remained unchanged despite the fresh production cuts announced by the Organisation of Petroleum Exporting Countries (OPEC) and its allies. “Despite cuts announced by the producing countries, oil prices have not increased as the market was able to absorb the impact,” said Puri.
Puri also emphasised that the government has assured affordable energy prices for consumers in the country. He added that Prime Minister Narendra Modi’s decision to reduce cooking gas prices by Rs 100 per 14.2 kg LPG cylinder was a move in that direction.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
