IOC may hike petrol prices
New Delhi   31-May-2011


IndianOil Chairman R S Butola speaks to the media during the announcement of the company’s financial results for 2010-11 in New Delhi on Monday. The state-owned firm posted a 29.7 per cent drop in profits for the fourth quarter because it had to sell fuel at government controlled rates.

State owned IndianOil, the nation’s largest fuel retailer, said on May 30, 2011, it may hike petrol price next month as the steep hike of Rs. 5 per litre of May 15 was not enough to cover for the cost of crude oil.

“Even after the hike, we are today losing Rs. 4.58 per litre. After including VAT, the desired increase at retail level comes to Rs. 5.50 a litre,” IOC chairman, Mr R. S. Butola, said.

The desired hike in price has been calculated based on the average crude oil price of the first fortnight of May. However, from June 1, which will take into account the average of second half of May when international rates moderated, IOC will lose Rs. 1.15 per litre. After including VAT, the desired hike in Delhi would be Rs. 1.35 a litre.

“Government is not compensating us for selling petrol at below international cost since June 2010 when its pricing was freed.” Mr Butola, however, refused to say when the rates will go up. “We will have to consider the environment we operate in before taking that call.” On diesel, he said, the company will from June 1 expected to lose Rs. 12.64 per litre. It currently loses Rs. 14.66 a litre on diesel.

Similarly, on domestic LPG it is losing Rs. 380.57 per cylinder and Rs. 25.85 a litre on PDS kerosene.