The government is expected to soon announce an increase in the prices of diesel and petrol as crude prices have shot up above the $90-a-barrel mark.
Retail prices of both diesel and petrol are expected to go up by around Rs2 a litre, petroleum secretary S Sundareshan hinted yesterday.
"OMCs are losing Rs4.71 per litre on diesel. There is a thinking (within the government) to pass on at least Rs2 per litre to consumers" he said, but added that the government has no plans to decontrol diesel prices in the near future.
The move comes at a time when crude prices have risen to a 26-month high of $90 a barrel, reflecting increased demand for grades usually refined for distillates such as diesel.
State-run Qatar Petroleum, which exports most of its crude oil production to Asia, raised the official selling price of Qatar Land crude to $84.77 a barrel and of Qatar Marine grade to $83.40 a barrel.
Crude prices are up nearly 5 per cent from October while refining margin for diesel has also shot up to $13.04 a barrel at end-November in Singapore, Asia's fuel hub.