New Delhi, Jan 12: Petrol prices may go up by Rs 3 a litre if Prime Minister Manmohan Singh at a meeting tomorrow accepts the Petroleum Ministry’s proposal to free pricing of petrol while gradually increasing the diesel rates.
 The Prime Minister is scheduled to review the financial health of oil PSUs at a meeting with Finance Minister Pranab Mukherjee and Petroleum Minister Murli Deora tomorrow evening.
 “Petroleum Ministry is likely to propose deregulation of petrol prices and gradual phasing out of subsidies on diesel to ease burden on public sector oil marketing companies,” a source said.
 The government has not allowed Indian Oil, Bharat Petroleum and Hindustan Petroleum to raise rates of petrol, diesel, domestic LPG and kerosene despite the cost of raw material (crude oil) jumping to USD 82 per barrel.
OilMin seeks Rs 30,000 cr bonds for fuel retailers
Petroleum Minister Murli Deora is seeking bonds worth Rs 30,000 crore for state-run fuel retailers to make up for the losses they incurred on selling domestic LPG and kerosene this fiscal.
“(Deora) will meet Finance Minister (Pranab Mukherjee) this evening on the issue,” Petroleum Secretary R S Pandey told reporters here.
Though the government had earlier this fiscal explicitly decided to compensate Indian Oil, Hindustan Petroleum and Bharat Petroleum for the losses they incur on selling domestic LPG and kerosene through PDS by way of oil bonds, the Finance Ministry has not issued any bonds for the three quarters.
The three firms lost Rs 11,853 crore in revenues on not being allowed to raise LPG and kerosene prices in line with the cost during April-September. An additional Rs 9,019 crore revenue loss was incurred in third quarter ending December 31.

Lastupdate on : Tue, 12 Jan 2010 21:30:00 Makkah time
Lastupdate on : Tue, 12 Jan 2010 18:30:00 GMT
Lastupdate on : Wed, 13 Jan 2010 00:00:00 IST