(a) whether there is no mechanism to regulate the prices of petroleum products,
Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) at present in the country;
(b) if so, the details thereof:
(c) the reasons for delay in notifying section 11
(f) of the Petroleum and Natural
Gas Regulatory Board Act; and
(d) the corrective steps taken by the Government to prevent restrictive trade practices
in the marketing of petroleum products and natural gas?
MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SMT.PANABAAKA LAKSHMI)
(a) & (b) In the light of the recommendations made by the Expert Group headed by Dr. Kirit S.
Parikh, the Government made the price of Petrol market-determined with effect from 26.06.2010.
Since then, the Public Sector Oil Marketing Companies (OMCs) take appropriate decision on the
pricing of Petrol in line with the international oil prices and market conditions.
However, in order to insulate the common man from the impact of rise in oil prices in the
international market and from the domestic inflationary conditions, Government continues
to modulate the Retail Selling Price (RSP) of Diesel (partially), PDS Kerosene and Subsidized
Domestic LPG, resulting in incidence of under-recoveries on the sale of these products to the
OMCs. In the light of the recommendations of the Kelkar Committee and in order to reduce the
under recovery of OMCs, the Government, on 17.01.2013, authorized OMCs to (a) increase the
retail selling price of Diesel in the range of 40 paisa to 50 paisa per litre per month
(excluding VAT as applicable in different State/Union Territories) until further orders,
and (b) sell Diesel to all consumers taking bulk supplies directly from the installations
of the OMCs at the non-subsidized market determined price with immediate effect.
Even after the above measures, based on the Refinery Gate Price effective 16.03.2013 for
Diesel and 1.3.2013 for PDS Kerosene and Subsidized Domestic LPG, the OMCs are incurring
under recovery of rs 8.64/ litre on sale of Diesel (to retail customers), rs 33.43/ litre
on PDS Kerosene and rs 439.00 per 14.2 kg cylinder of Subsidized Domestic LPG.
The retail price of PNG/CNG in any city is fixed by the City Gas Distributor (CGD) entity
operating in the city. The price of PNG/CNG is not decided or approved by the Government.
The CGD entity uses a varying mix of domestic gas, Long-term RLNG and spot RLNG prices.
The price of PNG/CNG is a function of the weighted average of the price of gas (domestic
gas/RLNG/Spot LNG), operating expenses, various Central, State and Local taxes and levies.
(c) & (d) Considering the volatility of the international oil prices and in view of
the Government’s commitment to provide sensitive petroleum products to the common
man at affordable price, the Government has been modulating retail selling prices
of Diesel (to retail consumers), PDS Kerosene and Domestic LPG.