Oil PSUs froze fuel prices to avoid panic: IOC chairman Sanjiv Singh

NEW DELHI: With oil PSUs deciding not to hike petrol and diesel prices ahead of Karnataka elections, IOC chairman Sanjiv Singh on Tuesday said the company has decided to “temporarily moderate” prices to avoid sharp spikes and panic among consumers.

“We have decided to temporarily moderate retail prices by not passing on the required increase as we believe the current international oil product prices are not supported by fundamentals. So we have decided to wait for a while. Passing them on to consumers will unnecessarily create panic,” Singh said.

Indian Oil and the two other state owned OMCs- Bharat Petroleum and Hindustan Petroleum have kept diesel and petrol rates unchanged across the country since April 24 despite the benchmark international rate for petrol going up by $3 from $ 78.84 per barrel, which was used for raising the price to Rs 74.63 a litre on April 24, to $ 81.61 at present.

Singh said it is just a coincidence that the spike in international rates and the company’s decision to moderate prices came in just ahead of the Assembly elections in Karnataka. However, the company has no plans to keep the price level moderate if international prices continue to increase as Singh said that retail prices will rise if the current trend in international oil prices continues.

“We do not interfere in the daily fuel pricing decision of OMCs,” he added. Prices of petrol and diesel have been decontrolled for years in the country, and for in June last year OMCs dumped the 15-year old practice of revising rates on 1st and 16th of every month and instead adopted a dynamic daily price revision to instantly reflect changes in cost. However, analysts feel companies come under government pressure in deciding fuel prices ahead of elections.