No hike likely in oil prices now

Govt stalls firms' Rs 2.85 a litre hike demand

The government today ruled out any immediate increase in the retail prices of petrol and diesel to bring them in line with international oil prices and to compensate for changes in the duty structure.

International oil prices during March have risen sharply to over $54 a barrel. "We will have to go to the Cabinet. My ministry will finalise its proposal (on price change) for the Cabinet today after which it will be circulated and the Cabinet will consider it thereafter," he said. The proposal is expected to come before the Cabinet by the month-end.

Oil companies are demanding a Rs 2.85 a litre increase in petrol and Re 1 per litre hike in diesel prices besides 0.50 paise increase in the road cess.

On the issue of disinvestment in Oil India Ltd (OIL), he said various options were being considered including floating an initial public offer. The government is considering offloading 15 per cent of its holding in OIL. It currently holds close to 98 per cent stake in the company.

Officials said the company was pushing for an IPO earlier but the proposal was not accepted by the government then. The petroleum ministry had instead favoured selling a part of government equity to Indian Oil Corporation to bring in downstream expertise in the essentially refining and marketing company.