Petrol prices not to be hiked this fortnight

Petrol prices will not be raised thisfortnight as state-owned oil firms apparently could not get political clearancefor the over Rs 2 per litre hike in rates needed to achieve parity with theimported cost on account of the weakening Indian rupee.

Indian Oil (IOC) and other state-run firms, which had lastmonth refrained from hiking petrol prices as the government was wary ofprotests while Parliament was in session, are not raising the rates even thisfortnight, a source privy to the development said.

Given the drubbing the Lokpal Bill got in the Rajya Sabha,the government does not want to alienate the Trinamool Congress, the most vocalopponent of fuel price increases within the ruling UPA.

Furthermore, assembly elections in five crucial states,including Uttar Pradesh and Punjab, have beenannounced and a hike in petrol prices would have created a "negativeimage", the source said.

State-owned oil companies, as per the usual practice, revise the rates forpetrol on the 1st and 16th of every month based on the average imported priceof oil and exchange rates during the previous fortnight. However, theypostponed a decision on the hike on December 31 as it was New Year's eve.

On Monday, the oil firms could not get the "informalpolitical approval" they used to seek from their majority shareholder, thesource said.

A hike of over Rs 2 per litre was necessitated because therupee depreciated to Rs 53.07 per US dollar in the second fortnight ofDecember, based on which the rates on January 1 were to be decided. The averageexchange rate stood at Rs 51.98 per US dollar in the first fortnight ofDecember.