Petroleum Minister Murli Deora today said that the government was likely to announce a cut in prices of petrol, diesel and cooking gas on Saturday as part of a market stimulus package which is also likely to include a Rs 2,000 cr export package and further relaxation in external commercial borrowing norms. Officials in the petroleum ministry said that petrol prices are likely to come down by Rs 5 per litre while diesel would be cheaper by Rs 2 per litre. Cooking gas prices are also likely to be cut by Rs 20 per cylinder. The Election Commission has also said that the move to reduce fuel prices is in national interest and does not violate the election code of conduct. Elections in five states are over while two of a total of seven phases of polling in Jammu and Kashmir scheduled for later this month. The fuel price cut is likely to bring down inflation which has already fallen to 8.4% for the week ended November 22 from a high of nearly 13% in July. The oil marketing companies – Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corpoeration – will however see pressure on their finances which had improved with oil prices falling by over 65% to $45 per barrel from a high of $147 per barrel in July this year. The companies are currently making a profit of around Rs 13 for every litre of petrol they sell and around Rs 3 for every litre of diesel. The companies are however still losing money of the kerosene and cooking gas they sell and are together expected to lose over Rs 100,000 cr in the current financial year.
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