The crucial meeting of Cabinet Committee on Political Affairs on Wednesday deliberated on the need of raising fuel prices in view of spurt in global oil prices, though there was no official word on the decision as yet.
The meeting, chaired by Prime Minister Manmohan Singh, attended by External Affairs Minister Pranab Mukherjee, Defence Minister A K Antony, Finance Minister P Chidambaram, Petroleum Minister Murli Deora, Railway Minister Lalu Prasad and Road Transport Minister T R Baalu.
Petrol and diesel prices were last raised in February when the Indian basket of crude oil was at $67 per barrel. Now it is at $124 per barrel.
State-run Indian Oil, Bharat Petroleum and Hindustan Petroleum were together projected to lose Rs 2,46,600 crore (Rs 2,466 billion) on sale of petrol, diesel, domestic LPG and PDS kerosene in 2008-09 in absence of any price hike or duty cuts.
The three firms were losing Rs 725 crore (Rs 7.25 billion) per day on fuel sales and had warned of fuel shortages from August when BPCL and HPCL were slated to run out of cash to import crude. IOC had funds to last till September.
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