No Going Back On Oil Price Deregulation, Says Jaitley

No Going Back On Oil Price Deregulation, Says Jaitley

The government on Saturday sought to comfort jittery stock market investors with finance minister Arun Jaitley assuring them on maintaining a deregulated regime for petrol and diesel prices.

Investors have hammered shares of state-run oil marketing companies after the government announced that the refiners will reduce prices of the auto fuel by Re 1 a litre along with a reduction in excise duty by Rs 1.5 a litre. On Friday, IndianOil shares closed 16% lower after an over 10% fall on Thursday. Similarly, HPCL tanked 25% on Friday, while BPCL lost 21%. ONGC, which holds a majority stake in HPCL and also owns stake in IndianOil, fell almost 16% on Friday.

In a blog, Jaitley suggested that the special situation due to a spike in global crude prices, along with a weaker rupee, called for a price reduction. “No government can be insensitive towards its people,” the minister wrote, while hitting out at the opposition-ruled states that had not reduced the state VAT even as those where BJP was in power had matched the Centre and reduced the levies. Read more

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