Probe into alleged cartelisation in petrol pricing soon: CCI

16 Mar 2013


The Competition Commission of India (CCI) will soon start an inquiry into the alleged cartelisation by state-run oil marketing companies in fixing the price of petrol, Ashok Chawla, chairman of the fair trade panel, said today.

He said the regulator has been in the process of finalising the specifics of the proceedings and will "very soon" initiate the probe.

"We are in the process of sending them an order which will ensure that there is investigation to see what is happening in terms of petrol prices," Chawla said.

CCI had earlier written to the petroleum ministry on the issue, but the ministry had washed its hands saying that since petrol is a deregulated product, the ministry has no say in the pricing of petrol.

CCI was also expected to have sent notices to the three OMCs - Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation - on the issue.

There is widespread apprehension over the practice of government compensating the oil marketing companies for the so-called under-recoveries as also the way the under-recoveries are calculated.

CCI also believes the practice of under-recovery in which the government compensates the OMCs for selling diesel at less-than-the market price is not fair. ''We are taking the route of advocacy with the government for such issues,'' Chawla had stated earlier.

Unlike petrol prices, diesel is still regulated by the government and under-recovery makes marketing of diesel for private companies unviable.

Meanwhile, CCI, which has also been probing the alleged abuse of monopoly by Coal India, has received the investigation report from the Director General (DG), the investigation arm of CCI.

"The Commission as a whole will look at the matter and then take a decision," Chawla said.

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