Petroleum product’s prices have soared recently and the Oil Minister Dharmendra Pradhan on Wednesday suggested ways to check it as many state governments have significantly increased value-added tax on the fuel.
The Minister said that hurricanes like ‘Irma’ and ‘Harvey’ in United States had significant impact on the fuel supply and that is the reason behind the increase in its prices.
Pradhan explained the reason behind surge in petrol prices and said that it is linked to international prices and not directly to the cost of production.
The government introduced a daily price revision system from 16 June. Prior to that, there was provision of fortnightly price revision.
The Minister said that about 13 per cent of the US refining capacity got hit because of hurricanes and affected global oil prices.
However, Pradhan denied any chances of tinkering with the tax structure so as to bring down the prices. But, he asserted that fuel prices are likely to ease in coming weeks as per the forecasts.
Defending the daily price revision system, Pradhan said that there are also instances when the benefits of price reduction also passed on to consumers directly.
Pradhan said that the government has no business to interfere in day-to-day operations of oil companies. Pradhan also passed the buck to Finance Ministry when he was asked about whether there is any chances of excise duty cut on petroleum product prices.