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‘Fuel price cut, a one-time move’

The petrol and diesel price cuts made earlier this month by state-run oil marketing companies was a “one-time measure”, and the government has no intention of reversing the deregulation of the oil market, a Finance Ministry official said here on Thursday.

‘Fuel price cut, a one-time move’
Representative image

New Delhi

The official, who did not wish to be identified, said that while the country’s economic fundamentals remained strong, the current volatility in the capital markets and a persistent fall in the rupee value are being caused by external factors. “It was a one-time measure of letting OMCs take the 1-rupee hit on oil prices. We have no intention of either rolling back deregulation of oil prices or asking oil companies to take such a hit,” he said.

Last week, the Centre cut petrol and diesel prices by Rs 2.50 per litre, a decision that was followed by several BJP-ruled states, giving an overall relief of Rs 5 per litre to the consumer. The centre reduced the excise duty on petrol and diesel by Rs 1.5 per litre each and asked the OMCs to absorb an additional Re 1 per litre reduction. Finance Minister Arun Jaitley said the Centre’s decision will result in a revenue loss of Rs 10,500 crore in six months. On whether state-run upstream explorer companies like ONGC could be asked to share the increased subsidies on kerosene and cooking gas, the official said: “We do not have any intention of asking upstream companies to share the subsidy burden.”

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