Petrol prices were reduced 32 times and increased 21 times while diesel prices were slashed 19 times and raised 28 times since 2013, Commerce Minister Nirmala Sitharaman said on Monday.
Sitharaman said retail selling price (RSP) of petrol and diesel in the country are linked to their respective international prices and OMCs are at present applying Trade Parity Pricing methodology to compute the RSP.
“Other cost elements in the RSP of petrol and diesel viz. excise duty, BS-IV premium, marketing cost and margins etc. are specific costs which do not increase/decrease with the volatility in international prices of petrol and diesel. The element of excise duty which is specific in nature has been increased since November 2014. Most of the state governments have also increased VAT on petrol and diesel. After taking into account these factors, OMCs have passed on major portion of decrease in price to consumers of petrol and diesel,” she said in Parliament.
The minister said the effective prices of PDS kerosene and subsidised domestic LPG have not been increased since June 25, 2011.
Sitharaman said price of crude oil in the international market fluctuate depending on various factors including demand and supply of crude oil. Similarly, the requirement of crude oil imports for consumption of petro-products and fulfilling the needs of oil refineries is an inter play of several factors like success in new production of crude oil, blending of bio fuels, success in conservation efforts etc.
The public sector oil companies import crude oil on term and spot basis as per the prevalent crude import policy, she said.
The minister said the impression that PSU oil companies make profits when the international crude price falls was “really not right” as they could make just 1.34 percent profit after tax in 2013-14 and 1.49 per cent in 2014-15.
Sitharaman said the PSU oil companies together had suffered around Rs 29,200 cross loss on petrol in the first nine months of last fiscal due to inventory cost and Rs 11,400 on diesel.