Vadodra, Nov 1: Chairman and Managing Director of the Oil and Natural Gas Corporation (ONGC) Ltd., Sudhir Vasudeva, said on Thursday that fuel prices must be hiked once every fortnight in order to acclimatise the Indian consumer to the regular changes in international crude prices.
Addressing mediapersons in Vadodara, Vasudeva said that fuel price hikes reflecting changes worldwide were essential, but were difficult in the face of political compulsions.
“Even though petrol is a deregulated product in India, there are sometimes political compulsions against hiking prices. If we are allowed the freedom, like OMCs (oil marketing companies) to raise prices every 15 days, the customer will get used to the fact that the changes in international prices will have to be accommodated,” he said.
Vasudeva said that international crude prices had risen owing to key suppliers wanting to fund their social budgets, and that the prices were unlikely to see a drop.
“It depends on the international fuel prices. No one can do anything about it. Given the geopolitical situation, where Saudi Arabia needs 85-90 dollars (a barrel) to fund their social budget, and Venezuela needs 90 dollars for their social budget, oil prices are not expected to reduce below current levels. 90-100 (dollars a barrel) has become comfortable for everybody. If prices go above 100 dollars, then it is a matter of worry,” he said.
Rising fuel prices have boosted Indian inflation in September to 7.8 percent, its highest level since November 2011, undermining the government case calling for an interest rate cut by the Reserve Bank Of India (RBI) in October to boost the sluggish economy. (ANI)