Knowing that 75% of our oil needs are imported the Finance Minister did not touch the custom duties on the imported oil. It still remains at 5 per cent on petrol and 7.5 per cent for diesel. Talking about excise duties, even they are the same at Rs. 14.35 per litre for petrol and Rs. 4.60 per litre for diesel. With crude oil at it maximum of USD 110 per barrel, the need to reduce the excise & custom duties was in its highest need.
The Ministry is also ignoring that the state owned companies IOC, BPCL & HPCL are losing Rs. 2.25 a litre on petrol which was supposedly freed by the Government control last June. Talking about diesel, the Indian companies are selling diesel at a loss of Rs. 10.74 per litre. The Budget was the only hope of the companies which now is washed away. Oil companies will have to increase the prices of these automobile fuels sooner than later.
The Budget session of parliament goes for a 3-4 week break from March 18 and that’s when we can expect the prices to shoot up again. We can still see a ray of hope as the Oil minister said that he will take this case to the Empowered Group of Ministers (EGoM) headed by Mukherjee after the Budget.
So even if we don’t have pricier cars we will have to pay the other way around by paying more for the fuel. Do you think the government would be justified if it raises the fuel prices again, especially in the light of the oil companies making heavy losses?