Decision on petro pricing system soon

The Union government is likely to take a decision on the issue of a free-market determined price system for petrol, diesel, kerosene (PDS) and domestic LPG by the end of this month.

The group of ministers (GoM) constituted by the government for the purpose is meeting this month.

"The GoM is meeting on January 17 and will make its recommendations to the Cabinet. We are expecting a decision from the government on the pricing system for these products towards the end of the month," said M S Srinivasan, secretary, Ministry of Petroleum and Natural Gas.

Srinivasan, who was here to inaugurate the first retail outlet of the Mangalore Refinery and Petrochemicals Ltd (MRPL), said the government's fear was that unless there was competition in the fuel retailing space, complacency might set in.

"We are for consumers. We are not for private sector or public sector," he said. "This underlines the need for free marketing and a free-market determined price so that efficiency is never given a go-by and consumers' interests are best served," he added.

On the seventh round of the New Exploration Licensing Policy (NELP-VII), Srinivasan expressed confidence that global biggies would participate in the bidding process. The roadshows would be held in the UK, Europe, US and Canada from January 22 to February 3.

Srinivasan said though a section of energy economists was projecting the crude oil price to touch $150 per barrel by June this year, the government's expectation was that it would stabilise around $80-85 over the next two years."

According to Srinivasan, India's exports of refined petroleum products are projected to go up to 40 million tonnes, earning foreign exchange worth $25 billion in 2007-08, up from 32 million tonnes and $18 billion, respectively, in the last fiscal.