Indian committee asks government not to deregulate diesel prices

The Standing Committee on Petroleum and Natural Gas, a Parliamentary panel, has asked the Indian government to refrain from the complete deregulation of items like diesel fuel and advocated for the compensation of losses incurred by oil firms from selling fuel at low prices. The committee cited the regulation of prices of petroleum products in several countries as a means to soften the impact of high oil prices. “The Committee are of the view that in our country which still is a growing economy, it will not be prudent to deregulate the prices of sensitive petroleum products as it can aggravate inflation and adversely affect the common man,” the committee said in its report. Petrol prices were deregulated last June, and with the continued control of the retail prices of diesel fuel, LPG and kerosene, oil companies are expected to lose Rs1,320,000 crore (US$268.1 billion) on fuel sales this fiscal year. (December 22, 2011)