Jaipal rules out hike in LPG prices

Jaipal rules out hike in LPG prices

Jaipal rules out hike in LPG prices

Union Minister for Petroleum S Jaipal Reddy, who was on a visit to the City, told Deccan Herald on Sunday: “As for LPG, diesel and kerosene, we are not thinking of increasing the prices until inflation is under control.”

Reddy, who had earlier this month expressed keenness on convening an empowered group of ministers meeting headed by Finance Minister Pranab Mukherjee to look into the prices of LPG, kerosene and diesel, said there has been no decision yet on the meeting, a probable indication of the Centre’s stand on these products. He spoke exclusively to Deccan Herald.

On the possible hike in petrol prices, given the depreciating value of rupee and international oil prices, Reddy said: “I have clarified this. And am saying it again that there will be no hike in petrol prices in the immediate future.”

Not ignoring the fears of the depreciating rupee, coupled with increasing global petroleum prices, Reddy said even if the condition of the rupee remains the same, it is unlikely that “I will be forced to increase the prices anytime soon.”

The Centre’s retreat comes even as oil firms are pressing the government for raising the prices of kerosene, diesel and LPG cylinder the under recoveries on which are costing the companies heavily.

Oil firms claim that they lose Rs 25.66 per litre on kerosene, Rs 10.17 on diesel and Rs 260.50 per domestic LPG cylinder.

The inflation rate, which is hovering close to double digits, has been a source of worry for the Centre which is struggling to bring it to manageable levels over the last 11 months. Reddy’s statement indicates that the UPA government is sensitive to voters’ feelings as indicated by its substantial withdrawal of hikes in petrol prices recently.
Such has been the popular anger and the Opposition rage over the government’s inability to check inflation that the Centre had to backtrack on the recent steep hike in prices of petrol and on a proposal to limit supply of cylinders on each gas connections to four a year. The elections due in UP, Punjab, Uttaranchal, Manipur and Goa State Assemblies in early summer are another disincentive.

Over the past year, petrol prices were raised four times, the latest earlier this month.