New Delhi: The over-recovery on diesel sale for the state-owned oil marketing companies has shot up to Rs3.56 per litre. Cabinet is expected to soon take a decision on cutting diesel prices.Due to fall in international prices, over recovery on diesel increased from Rs1.90 per litre during 1st October 2014 to Rs3.56 per litre from 16 October.
While petrol prices have been cut regularly, decision on lowering diesel prices was delayed due to model code of conduct in view of state elections in Maharashtra and Haryana which concluded on Wednesday.State owned companies were able to cut petrol prices because the decision to deregulate petrol was taken long back in 2010. On the other hand on January 17, 2013, cabinet only allowed a monthly increase in diesel price of 40-50 paise per month to wipe out the under-recovery. However, now to cut diesel prices, Cabinet will have to take a decision.
“The government will take the right decision at the right time,” Oil minister Dharmendra Pradhan had said on diesel price cut on Tuesday. He said that as “you are aware, election code of conduct is in place so will decide on the issue at the right time.” However, under-recoveries continue on kerosene and LPG sale.
In the case of PDS kerosene and domestic LPG, the under-recoveries for the second fortnight of October 2014 will be Rs31.22 per litre (Rs32.67 per litre in last month) and Rs 404.64 per cylinder (Rs427.82 per cylinder in last month).
State-owned fuel retailers — IOC, BPCL and HPCL are losing about Rs139 crore a day on sale of PDS kerosene and domestic LPG. This is lower than Rs156 crore daily under-recoveries during previous fortnight.
