The government has increased petrol prices by an average Rs 3 per litre, while diesel prices by Rs 2 per litre. The good news is that therell be no change on fuel prices for some time - till end-March, 06.
So while petrol prices will move up to Rs 43.49.49 per litre in the Capital, it will sell at Rs 49.16 in Mumbai. Diesel will sell at Rs 30.45 per litre in Delhi and Rs 37.57 in Mumbai. Retail prices are the highest in Mumbai; and Chennai, where the state governments enforce the highest sales tax. Cooking fuel prices have been left unchanged. The increasing oil crisis, which had driven oil marketing; companies in the red, was resolved today with the government announcing a comprehensive oil package for all stakeholders.
While consumers will feel the stroke with a hike in auto-fuel prices, the government will pay for a part of the losses by issuing oil bonds of at least Rs 10,000 crore to the oilcos.
Govt to take a hit of Rs 12,000 cr
The government has worked out a fair sharing formula to deal with the global oil shock and this is how the sums work. While the government has taken a hit of a round Rs 12,000 crore by issuing oil bonds to the oilcos, by the year-end consumers would have done their bit by paying an additional Rs 5,000 crore through the price hike. More than half the revenue shortfall projected for 05 - 06 is around Rs.40, 000 crores. This includes the subsidy shortfall on sale of kerosene and LPG and the losses suffered on sale of petrol and diesel.