Fuel prices hike: Oil Minister Pradhan to meet OMCs

As petrol and diesel prices keep rising unabated, Petroleum Minister Dharmendra Pradhan is expected to meet the oil marketing companies this evening to discuss ways to keep the oil prices in check.

Petroleum ministry secretaries are also scheduled to meet the officials in the Prime Minister's Office to discuss the current situation in the country arising out of higher crude prices.

Petrol and diesel prices have risen by over two per litre across the country in the past nine days after the Karnataka Assembly elections on May 12.

Pradhan's meeting with oil companies comes in the wake of his assurance to common people that the government would come out with a solution soon as it was looking for various alternatives to check prices from rising.

Meanwhile, petrol prices were highest in Mumbai at Rs 84.70 per litre and diesel at Rs 72.48 a litre.

Sources said that the government was working on a comprehensive plan to douse oil prices that included some absorption by the oil marketing companies.

States will also be asked to reduce VAT or local taxes on petrol and diesel while an intervention by the Reserve Bank of India keeps the rupee at a reasonable level.

The Finance ministry is, however, non-committal on reducing the excise duty once again on the two fuels as it may dent is fiscal maths. A top ministry official had last week refused to answer a question on whether the government was thinking on cutting the excise duty.

Earlier in the day, Moody's Investors Service too raised a concern on rising oil subsidy bill in India due to the sky-rocketing global crude prices.

It said the state-owned Oil and Natural Gas Corporation and Oil India may have to bear a large part of fuel subsidies this year as the government was staring at a fuel subsidy as high as Rs 53,000 crore in the current financial year (2018-19).