Petrol prices cut again; OMCs silent on diesel

IndianOil said it had decided to cut the prices of petrol Rs 0.7 a litre (excluding state levies) from Tuesday midnight

Government-controlled oil marketing companies (OMCs) on Tuesday announced a second cut in petrol prices this month, though they were silent on the monthly rise in diesel price as part of a phased de-control of the fuel's prices.

IndianOil Corporation said it had decided to decrease the prices of petrol Rs 0.7 a litre (excluding state levies) from Tuesday midnight. On April 1, the prices were reduced Rs 0.75 a litre (excluding state levies), resulting in the price at Delhi going down Rs 0.9 a litre.

"This cut was made on the back of a declining trend in global prices, accompanied by a strengthening of the exchange rate."

The price at Delhi would come down Rs 0.85 a litre.

OMCs have underrecoveries of Rs 5.49 a litre on diesel, Rs 34.43 a litre on kerosene (sold through the public distribution system) and Rs 505.5 a litre on domestic liquefied petroleum gas (LPG) cylinder.

The projected under-recoveries of IndianOil on the three are Rs 62,000 crore for 2014-15. The sector's is Rs 1,20,000 crore.

Earlier this month, IndianOil had said the government had referred the matter relating to pause on monthly diesel price hike to the Election Commission since the revenue loss on diesel had fallen below Rs 6 cap suggested by the Kirit Parikh committee.