- Officials from the petroleum ministry have said that the government will ask ONGC to sell it’s fuel to refiners and distributors at around $70 a barrel.
- Global oil prices are currently $79.5 a barrel.
- The move is significant, and along with a cut in dealer commissions, could reportedly cut fuel prices by around ₹2 a litre.
With fuel prices rising for the tenth consecutive day this morning, India’s government is finally stepping in to avert a full-blown crisis. But rather than endangering the revenues it receives from taxes and duties on petrol, given its widening fiscal deficit, it is asking India’s largest gas and oil exploration company to take a hit.
Officials from the petroleum ministry have said that the government is looking to get the state-owned ONGC to sell it’s fuel below the current global price – which is $79.5 a barrel at the moment. A price level of $70 a barrel was mooted. Concurrently, the government is also asking dealers and distributors to reduce their commissions by as much as ₹0.23 a litre.