Petrol and Diesel prices not to be hiked

Petrol and diesel prices will not be hiked this year as the government on Thursday decided on a package including issue of oil bonds to offset the impact of surging international crude oil prices.
"We have kept our promise of not raising prices of sensitive petroleum products," Petroleum Minister Murli Deora said after a meeting of the Cabinet.

Of the Rs 54,935 crore revenue loss that public sector oil firms are likely to suffer this fiscal for not raising prices of petrol, diesel, domestic LPG and PDS kerosene in line with cost, 42.7 per cent or Rs 23,457.24 crore would borne by the government.

Besides oil bonds, the Cabinet also decided to extend budgetary subsidy on domestic LPG and PDS kerosene for three more years from April 1, 2007, Deora said, adding that the government provides about Rs 2,680 crore from the budget to subsidise the mass-consumed cooking fuels.
Indian Oil, Bharat Petroleum and Hindustan Petroleum will get oil bonds worth Rs 23,457.24 crore. The first trance of about Rs 11,800 crore to compensate for losses suffered in first half of 2007-08 would be issued by next week. .