IOC seeks freedom to fix retail prices of fuels

Indian Oil Corp (IOC), the nation's largest oil company, has sought greater autonomy in its day-to-day management and freedom to fix retail prices of fuel.

In the annual performance and memorandum signed with the petroleum ministry, the oil major has stated that `Navratna' oil companies should be granted freedom to fix the retail sale prices of petrol, diesel, domestic LPG and kerosene.

Oil firms are not allowed to raise fuel prices in line with the cost, as an anti-inflationary measure, by the government. IOC may suffer a revenue loss of Rs23,510 crore on its below-cost fuel sales in 2009-10.

IOC reported a 6.2 per cent increase in oil product consumption in August this year, almost the same as in August last year. The state-run oil marketing company said the increase in comsumption has been due to increased demand for mass consumed products such as LPG, petrol, and diesel, as well as bitumen and jet fuel.

Domestic sales of oil products rose to 10.73 million tonnes in August this year from 10.106 million tonnes in the same month last year, government data showed.

According to the Petroleum Planning and Analysis Cell (PPAC), diesel sales in the country recorded a growth of 15.1 per cent at 4.176 million tonnes from 3.628 million tonnes during the month. This has been due to inadequate rains in the northern region and high use of diesel-operated pump sets for irrigation, it said.