Petroleum Minister Veerappa Moily yesterday held a meeting with the
top officials of oil companies to discuss the proposal to raise the cap
on subsidised LPG cylinders from six to nine, but Moily also declared
that it was up to the oil marketing companies to make the final decision
on if they want to raise the cap or not.
In an interview, Moily said, "We've given a lot of freedom to the oil companies. We have deregulated a lot of things now ... the decision to hold the price increase is for the respective companies to take."
People with direct knowledge of the meeting said that oil marketing firms, viz. Indian Oil, Bharat Petroleum and Hindustan Petroleum, didn't welcome the proposal to hike the cap on subsidised LPG cylinders from six to nine.
Speaking on the condition of anonymity, the people added that the ailing oil companies wanted full compensation for any hike in the number of subsidised cooking gas cylinders.
Another source in the Petroleum Ministry said that onus to hike the proposed cap was on the Finance Ministry.
If the cap on subsidised LPG cylinders is hiked by three, then the oil companies will have to bear an additional burden of Rs 3,000 crore for the current financial year.
It may be noted here that the prices of kerosene, diesel and LPG are controlled by the government. As the oil marketing companies sell these fuels at subsidised rates fixed by the government, they incur huge losses. However petrol is a deregulated fuel, and thus oil companies are free to revise its price from time to time.
In an interview, Moily said, "We've given a lot of freedom to the oil companies. We have deregulated a lot of things now ... the decision to hold the price increase is for the respective companies to take."
People with direct knowledge of the meeting said that oil marketing firms, viz. Indian Oil, Bharat Petroleum and Hindustan Petroleum, didn't welcome the proposal to hike the cap on subsidised LPG cylinders from six to nine.
Speaking on the condition of anonymity, the people added that the ailing oil companies wanted full compensation for any hike in the number of subsidised cooking gas cylinders.
Another source in the Petroleum Ministry said that onus to hike the proposed cap was on the Finance Ministry.
If the cap on subsidised LPG cylinders is hiked by three, then the oil companies will have to bear an additional burden of Rs 3,000 crore for the current financial year.
It may be noted here that the prices of kerosene, diesel and LPG are controlled by the government. As the oil marketing companies sell these fuels at subsidised rates fixed by the government, they incur huge losses. However petrol is a deregulated fuel, and thus oil companies are free to revise its price from time to time.
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