Wednesday, April 1st, 2020

Big import dependence makes it imperative that International oil prices will have a decisive role to play in the domestic retail prices : Murli Deora

INVC,, Chennai,, Murli Deora, Union Minister of Petroleum and Natural Gas has said that since country imports about 80 per cent of its crude oil requirements, it is only natural that international oil prices will have a decisive role to play in the domestic retail sale prices. The Minister was chairing the Consultative Committee Meeting of the Members of Parliament for the Ministry of Petroleum and Natural Gas at Chennai today. The agenda of the meeting was “International oil prices and their impact on India”.

He informed that international oil prices have been on the rise since 2003-04. From an average prices of US $28 per barrel in 2003-04, the international oil prices touched record high in 2008-09, with the Indian basket averaging US $ 83.5 per barrel. In July 2008, the Indian basket of crude oil exceeded US $ 142 per barrel, he added. In order to protect the consumer from the inflationary impact of high international oil prices, government decided not to pass through the full impact in the retail sale price and bear the burden itself. As a result, during 2008-09, the OMCs incurred under recoveries of Rs.1,03,292 crore,

He pointed out that government has always protected the interest of "Aam Admi". It has been endeavour of the government to make available petroleum products of right quality and at the reasonable prices to consumers. When international oil prices began to fall in the later part of 2008-09, the government reduced the prices of petrol and diesel by Rs.5 per litre and Rs.2 per litre respectively, Shri Deora stressed. The government further reduced the prices of petrol, diesel and domestic LPG by Rs.5 per litre, Rs.2 per litre and Rs.25 per cylinder at Delhi on 29th January 2009, he added.

To compensate the OMC's against under–recoveries during 2008-09, the government issued oil bonds of Rs.71,292 crore while the upstream oil PSUs contributed Rs.32,000 crore, the minister said. During 2009-10, the OMCs have incurred under–recoveries of Rs.46,051 crore and the government has given cash assistance of Rs.26,000 crore while the upstream contribution amounted Rs.14,430 crore. The remaining under–recoveries of Rs.5,628 crore have been absorbed by the OMCs, Shri Murli Deora clarified.

The Minister said the OMCs combined borrowings which were Rs.23,400 crore in March 2005 have increased to Rs.88,300 crore at the end of March 2010. While mentioning about the recommendations made by the Kirit Parikh Committee, he said the government has recently constituted an Empowered Group of Ministers (EGOM) to examine the recommendations.

He also said that the landmark judgement by the Supreme Court in the gas allocation case upheld the stand of the government that natural gas is a national asset and the authority for allocation and distribution of gas vests in Government of India.

The Minister further informed the committee about his visit to Venezuela to promote relationship in the field of hydrocarbon sector. ONGC Videsh Ltd., Indian Oil Corporation and Oil India in consortium with Spanish company Repsol and Malaysian Company Petronas have signed an agreement with Venezuela's state owned firm PDVSA for producing hydrocarbon from carabobo field in Venezuela, he added. “The government is actively pursuing the policy of acquisition of more oil acreages abroad to achieve energy security for the country,” he added.

As per the "Vision – 2015" adopted for Ministry of P&NG in June 2009, it is envisaged to increase the LPG coverage to 75 per cent of the population of the country from the present coverage of 50 per cent, according to the Minister. It is proposed to achieve this target by increasing the LPG customers from present 11 crores to 16 crores through the Rajiv Gandhi Gramin LPG Vitrak (RGGLV) scheme for setting up small size LPG distribution agencies in order to increase rural penetration. Presently, the scheme has been launched in 8 states covering over 1200 locations, where the reach of LPG is below 50 per cent of the national average of LPG coverage, Shri Deora explained.

The MPs who took part in the consultative committee meeting raised issues such as tax variations on petroleum products in various states, adulteration of diesel with kerosene, subsidy to kerosene-which intends to help BPL families- not reaching the beneficiaries and misused by others, restrictions on use of petrol, corporate social responsibility of oil companies etc. Shri Murli Deora assured the members to look into the issues and would take appropriate action.

The following MPs took part in the meeting : Dr K Samba Siva Rao (Andhra Pradesh), Shri Chandrakant B Khaire (Maharashtra), Shri Uma Shankar Singh (Bihar), Shri Paban Singh Ghatowar (Assam), Shri Radhey Mohan Singh (Uttar Pradesh), Shri G V Harsha Kumar (AP), Shri Sushil Kumar Singh (Bihar), Shri Radha Mohan Singh (Bihar), Shri Nishikant Dubey (Jharkhand), Shri A A Jinnah (Tamil Nadu), Shri Subash Prasad Yadav (Bihar), Shri Raashid Alvi (AP), Shri Praveen S Rashtrapal (Gujarat), Shri V Hanumantha Rao (AP), Shri Birendra Prasad Baishya (Assam), Smt Maya Singh (MP), Shri Pratap Singh Bajwa (Punjab), Shri Dhiraj Prasad Sahu (Jharkhand).

The Secretary, Additional Secretary, high level officers of the Min. of P&NG and Chief Executive Officers of Oil Public Sector Undertakings also participated in the meeting.

[caption id="attachment_13717" align="alignnone" width="500" caption="The Union Minister of Petroleum and Natural Gas, Shri Murli Deora addressing the media after chairing the Parliamentary Consultative Committee meeting, in Chennai on May 24, 2010. The Secretary, Ministry of Petroleum and Natural Gas, Shri S. Sundareshan is also seen."]The Union Minister of Petroleum and Natural Gas, Shri Murli Deora addressing the media after chairing the Parliamentary Consultative Committee meeting, in Chennai on May 24, 2010. 	The Secretary, Ministry of Petroleum and Natural Gas, Shri S. Sundareshan is also seen.[/caption]

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