Petrol may get costlier by Rs 2.25 per litre from Jan 1

Posted By: Religare
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Petrol may get costlier
State-run oil marketing companies (OMCs) have been looking to increase the petrol prices by about Rs 2.25 a litre from January 1, 2012, depending upon the green signal from government as elections draw closer next year, said a media report.

The report indicated that government had already refrained OMCs from raising prices at the last fortnightly review, in order to prevent uproar in the winter session of parliament.

While the next price review would be on Jan 1, analysts are expecting a steeper increase as oil firms need to make up for the losses.

Analysts opined that domestic prices need to be increased by Rs 1.90 per litre excluding taxes, in order to play catch-up with import costs, and if taxes are added, prices might go up by Rs 2.25 per litre.

Government of India has already been facing lot of ruckus in parliament, on various issues like FDI, Lokpal, and raising the prices during the December month would have caused fresh trouble for Congress. Also going ahead, assembly elections for five states are scheduled in february, which might also be a factor that could force govt to avoid any petrol price hike.

Dion Global Solutions Ltd

Read more about: tax, government, fdi
Story first published: Friday, December 30, 2011, 22:30 [IST]
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