UPA bows, petrol price cut slightly
To cost Rs 79.61 in City
The retail price of petrol came down by Rs 2.14 per litre in Bangalore city on Saturday after oil marketing companies (OMCs) reduced the basic price of the fuel by Rs1.68 a litre. The revised price in the city has come down to Rs 79.61 per litre as against the last 11 days price of Rs 81.75. The change is effective Saturday-Sunday midnight.
The reduction came 10 days after the OMCs effected the steepest-ever basic price hike of Rs 6.28 a litre, which had triggered a nation-wide outcry that prompted the opposition NDA, the Left parties, and even some of the allies of the ruling UPA to observe Bharat bandh on Thursday.
On Friday itself, there were expectations that the OMCs would announce a price cut since, under the petrol price decontrol decision of the UPA government announced in June, 2010, they are allowed to review the price on 1st and 16th of each month on the basis of the fortnightly movement of the average cost of crude imports and the rupee-dollar exchange rate.
The Indian Oil Corporation Ltd (IOC), the country’s leading OMC, reported on Friday a Rs 1.63 per litre reduction in the price at which it buys petrol from the oil refineries. The reduction was due to a significant reduction in the crude price in the international market during the last fortnight. The crude imports could have been cheaper still if the rupee had not depreciated against the dollar during the same period.
Sources said that the retail price revision was not announced on Friday as the UPA government did not want to give an impression that the reduction had come about due to the pressure mounted by the opposition parties against the May 23 hike.
Oil industry sources said further price reduction was possible in the next fortnight if the international crude prices continue to ease further and the rupee–dollar exchange rate remained stable at the current level or improved in favour of the rupee.
The price cut, however, did not impress the parties Opposing the last hike. The opposition NDA and the UPA partners such as the Trinamool Congress and DMK demanded a complete rollback of the May 23 hike. “This is not what the BJP or the people have asked for... (We) want complete rollback of the petrol price”, the BJP said here soon after the announcement of the price cut.
