Petroleum and Natural Gas Minister S. Jaipal Reddy Tuesday said no decision had been taken on increasing fuel prices in the country but added that it was "an immediate necessity".
On his way to Ashgabat (Turkmenistan) for the signing of an agreement on the Turkmenistan-Afghanistan-Pakistan-India oil pipeline, Reddy told reporters here that the rupee's depreciation against the US dollar would further cause a loss of thousands of crores of rupees to oil companies.
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"They (oil companies) are not demanding (fuel price hike) but that is an immediate necessity," Reddy said.
"When and how to do this, I cannot predict now. No decision has been taken as yet. We will talk to all political parties (before taking a decision on the hike)," Reddy said.
"The rupee is depreciating day by day. With the depreciating rupee, the oil companies will suffer a loss of Rs.72,000 crore this year," he said, expressing concern at the development.
Reddy pointed out that for every rupee that the currency (rupee) depreciated against the US dollar, the oil companies suffer a loss of Rs.8,000 crore.
"The US dollar has crossed Rs.55 mark. It was Rs.46 per dollar last year," he pointed out.
Oil companies have been asking the government to allow them to hike fuel prices, both petrol and diesel, in view of their losses, but that has not been allowed so far as this could lead to inflation in the country.
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