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Oil minister tweets cut in petrol price

New Delhi, Aug. 13: Petrol prices will be cut by Rs 1.89-2.38 per litre from the midnight of August 14, the second reduction in a month and the steepest in 11 months.

In Calcutta, petrol will be cheaper by Rs 2.27 at Rs 78.03 a litre.

“The price of petrol will be reduced from the midnight of 14/15 August 2014 in the range of Rs 1.89-2.38 (Rs 2.18/litre at Delhi),” oil minister Dharmendra Pradhan tweeted today.

His tweet took all by surprise as this is the first time a minister has announced a cut in the price of petrol, which was deregulated in June 2010.

Pradhan made the announcement more than 31 hours before the new prices will be implemented.

Usually, state-owned oil companies announce the price revision only on the eve of the change being effected.

Later in the day, state-owned refiner Indian Oil, in a statement, said petrol prices would be cut from the midnight of August 14/15.

“Since the last price change, while international petrol prices have further declined, the rupee-dollar exchange rate has significantly depreciated. The current levels of international prices and the exchange rate warrant a decrease in the selling price of petrol in the domestic market. Thus, a downward revision is being effected with effect from the midnight of 14th/15th August, 2014,” the statement said.

On August 1, petrol prices were cut by Rs 1.13 per litre.

Oil retailers revise petrol prices on the 1st and 16th of every month based on the average international oil price and the rupee-dollar exchange rate in the previous fortnight.

Officials said these dates were not binding on the companies; prices have been changed on other dates as well. This time an announcement was made earlier than scheduled as the officials of state-owned refiners would be on leave because of an extended weekend.

As prices are being rolled back, pump owners are unlikely to hoard the commodity even as car owners are likely to delay filling up their tanks.

IOC chairman B. Ashok, yesterday hinted at a price cut on the eve of the Independence Day because of the softening in international rates.

Meanwhile, Pradhan said in the Rajya Sabha today that the government would come out with a new gas price formula by the end of September keeping in mind the interests of investors and consumers.

However, he said no committee had been set up to suggest an alternative to the Rangarajan formula approved by the previous UPA government that would have doubled the price of gas to $8.4 per million British thermal unit.

 
 
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