Union Petroleum and Natural Gas Minister Hardeep Singh Puri hinted on Thursday that the government could cut the rates of petrol and diesel if the crude prices stay low for the next few weeks in the international market.
Puri said Oil Marketing Companies (OMCs) incurred a loss of Rs 74,781 crore for selling petrol, diesel and liquified petroleum gas (LPG) till June 30 due to the conflict between the United States (US) and Iran in the Middle East.
Though international crude rates have come down, OMCs are still incurring losses and “processing crude bought at height of West Asia crisis”, the oil minister said at a media briefing in New Delhi.
“I did a review yesterday of our capital expenditure pertaining to this ministry and public sector units. We have different projects which are at an advanced stage, including refineries, which in the next 6 to 12 months will be implemented, and this will bring our refining capacity to 300 million metric tonnes per annum. This is a noteworthy and remarkable figure,” Puri said.
“Why did we do well and come out of the crisis without any closures and dry outs? In the entire period of March, April, May and June, there were no dry-outs. By and large, there was no disruption, shortage or queues,” he added.
The hike in petrol, diesel rates
The global supply chains disrupted massively this year due to the US-Iran war that ultimately led to the closer of Strait of Hormuz through which nearly one-fifth of global crude transits. India has repeatedly called for the Hormuz to remain so that the supply chains remain stable.
But with the US and Iran signing a peace deal, the situation has improved and international brent crude rates have fallen; though petrol and diesel prices remain unchanged in India.
From July 1, the restrictions on sale and distribution of petrol and diesel was uplifted after the central government conducted a review meeting. “The temporary measures helped ensure adequate availability of petrol and diesel across the country while safeguarding the interests of retail consumers. Their withdrawal reflects the improvement in the supply situation and the restoration of normal supply arrangements,” the government said in a release last month.
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