Indian Petroleum Minister Murli Deora today said the government is trying its best not to hike prices of fuels like diesel, but is faced with a challenging task due to the unpredictable movement of crude oil rates in international markets.
"We want the people of India to get fuel at the right prices," he said at a press conference in Singapore when asked about a likely increase in diesel rates in light of a surge in global crude prices.
"We are hopeful of finding a right solution to the current situation of diesel prices," Petroleum Secretary S Sundareshan added.
The assurances from India's top energy officials come amid a surge in oil and energy costs across the globe.
Diesel, kerosene and LPG prices are politically sensitive and remain a major concern for the Indian government, which is already combating high inflation and a steep rise in prices of essential agri-commodities like onions.
The Indian government also faces the challenge of deregulating or setting market-driven prices for diesel, LPG and kerosene, having done so with petrol prices.
Deora, who is in Singapore to launch a roadshow for the ninth round of the New Exploration Licensing Policy (NELP-IX) tomorrow, also gave an assurance that crude oil supplies from Iran to Indian refiners like MRPL will not be held up over the ongoing payments row.
A mutually acceptable payment method is being worked out between the Indian and Iranian governments, he said, adding that a breakthrough is expected early next week.
A high-level Indian delegation led by an Additional Secretary in the Finance Ministry and comprising bank and energy industry officials will visit Tehran this weekend to resolve the payment issue.
Meanwhile, Iran continues to ship crude to Indian refineries based on the guarantees given by the oil companies, Sundareshan told reporters at the press conference.
Sundareshan ruled out any possibility of a disruption in crude supplies from Iran, stressing on the good working relationship between Iran and India. In this regard, he said resolution of the deadlock on crude oil payments in a non-US dollar currency was only a matter of time.
Deora also said the issue of Vedanta Resources Plc buying a stake in Cairn India Ltd would be resolved in the coming weeks.
He also clarified that the ministry has neither objected to, nor supported the acquisition of a majority stake by Vedanta in Cairn and a decision can be expected next month.
Taking questions from the audience, he said ONGC Videsh will continue to seek assets overseas, including in Vietnam, which has "very good relations" with India.
However, whether OVL will be allowed to acquire BP's stake in assets being sold in Vietnam is up to Vietnam's national oil company PetroVietnam and the Russian partners in the blocks, said Deora.
Sundareshan indicated that another firm, TNK-BP, seems to have the scales tipped in its favour by virtue of the Russian companies already involved in the Lan Tay and Lan Do gas fields and associated pipeline and power generation interests being sold by BP in Vietnam.
Deora is in Singapore for a three-day roadshow promoting the upcoming auction of 34 petroleum and gas prospecting blocks in India, eight of which are in deep-water areas, while remaining acreages are being offered for exploration for the first time.
Around 120 representatives from international exploration companies are expected to attend the roadshow in Singapore.
Govt Doing its Best Not to Hike Crude Prices: Deora
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