 "Petroleum minister says no increase in diesel, LPG price")
In an interaction with the media today, the minister said, "We are not thinking about an immediate increase in prices of diesel, kerosene or LPG. On the other hand, oil marketing companies were directed to prepare a contingency plan to source crude from alternate markets other than Iraq. We also have the option of depending on spot markets. There is no reason to panic." The minister added that India is closely watching the dynamic developments in Iraq and as of now there is no stoppage on the country's linkage to Iran.
Earlier on the day, petroleum secretary Saurabh Chandra had a meeting with Prime Minister's Office on the Iraq issue.
Though the under recovery on diesel for the current fortnight had come down to Rs 1.62 a litre, while that of kerosene and domestic LPG stood at Rs 32.87 a litre and Rs 432.71 a cylinder, respectively, the government is worried revenue losses would go up. The under-recoveries on sensitive petroleum products for the financial year 2014-15 are projected to be Rs 91,665 crore, compared to Rs 1, 39,869 crore in 2013-14. According to ministry estimates, per dollar increase in diesel prices would add Rs 3,300 crore to under recovery figures.
The Indian basket crude oil prices as on June 19 was $111.94. "Even during the crisis of Saddam Hussain regime, the Basra region in Iraq from where we have the linkage never got affected. It is in the North Eastern part of Iraq. Hence we are expecting the same this time, "he added.
Iraq is the second largest importer of crude oil to India, contributing to 13% of the coutry's overall import. Oil marketing companies were planning to import slightly above 20 million tone of crude from that country this fiscal.