‘Fuel price cut, a one-time move’

The official, who did not wish to be identified, said that while the country’s economic fundamentals remained strong, the current volatility in the capital markets and a persistent fall in the rupee value are being caused by external factors. “It was a one-time measure of letting OMCs take the 1-rupee hit on oil prices. We have no intention of either rolling back deregulation of oil prices or asking oil companies to take such a hit,” he said.

Last week, the Centre cut petrol and diesel prices by Rs 2.50 per litre, a decision that was followed by several BJP-ruled states, giving an overall relief of Rs 5 per litre to the consumer. The centre reduced the excise duty on petrol and diesel by Rs 1.5 per litre each and asked the OMCs to absorb an additional Re 1 per litre reduction. Finance Minister Arun Jaitley said the Centre’s decision will result in a revenue loss of Rs 10,500 crore in six months. On whether state-run upstream explorer companies like ONGC could be asked to share the increased subsidies on kerosene and cooking gas, the official said: “We do not have any intention of asking upstream companies to share the subsidy burden.”