PM will review oil prices

Prime Minister Manmohan Singh will review petrol and diesel prices, which have remained unchanged since August despite international crude prices surging to an all-time high of over $53 a barrel.

A decision on an increasing prices of the two automobile fuels will be taken after the meeting with the Prime Minister.

"Fuel prices will be reviewed with respect to international prices on October 15. Whether the prices will be hiked or not will be decided after I place before the Prime Minister all the facts," Petroleum Minister Mani Shankar Aiyar told reporters on the sidelines of a seminar here today.

Sources in the Prime Minister's Office (PMO), however, said a meeting had not been scheduled so far. "It is a matter between the finance ministry and the petroleum ministry," said an official.

The finance ministry is of the opinion that the burden should not be passed on to consumers as oil companies continued to enjoy significant refining margins.

However, the petroleum ministry is trying to ensure that the margins of public sector oil companies are not affected, according to a PMO officials.

"The interests of consumers will be the most important consideration. We want Indian oil companies to make their contribution for protection of the economy and share the burden of consumers," Aiyar said.

Diesel prices need to be raised by close to Rs 3 a litre hike and petrol prices by 50 paise a litre to bring domestic prices in sync with international trends.

Aiyar, however, indicated that the government might not bite the bullet.

"We will protect the economy and ensure the interests of public sector companies are also guarded," he said.