New Delhi, May 30
Petrol and diesel prices are likely to go up by Rs 2 to Rs 3 a litre this week, but the government is expected to spare consumers of kerosene and cooking gas from a price revision under the pressure of the Left parties.
The Finance and Petroleum Ministries today discussed moderate increase in prices of fuel after the former resisted a cut in excise and customs duty to cushion the impact of surging global crude oil prices.
The proposal may be taken up when the Union Cabinet meets this week, Petroleum Minister Murli Deora said after meeting Finance Minister P. Chidambaram today.
The government may, however, issue fresh bonds to oil firms to make up for the unbridged cost despite the moderate increase in price.
"We discussed all possible avenues, including duty restructuring... However, a final decision will be taken by the Cabinet," Mr Deora said.
The Petroleum Ministry will prepare a note for consideration of the Cabinet, possibly on Thursday or Friday, he said.
Though Mr Deora's points of discussion included duty restructuring, official sources said there might not be any duty cut in fuel, an alternative suggested by the Left parties.
The meeting between the two ministers came against the backdrop of spurting international crude prices, which has had a cascading effect on the domestic oil companies, especially since they have not been allowed to increase retail fuel prices since September last year.
Oil PSUs have demanded an increase of Rs 10.5 per litre of petrol, Rs 9.88 a litre on diesel, Rs 120 per LPG cylinder and Rs 16.78 per litre of kerosene.
