Govt may seek 6 month extension on clean fuels

The government’s plan to introduce clean fuels in the country may be derailed, although partially. While the April 1, 2005 deadline on ...

The government’s plan to introduce clean fuels in the country may be derailed, although partially. While the April 1, 2005 deadline on the Euro III standards in the four metros in both petrol and diesel seem to be on track, the same deadline for Bharat II in diesel in some parts of the countries might not be met. However, the Bharat II deadline for petrol seems to be on course.

A senior official in the petroleum ministry said the ministry plans to seek an extension of around six months on Bharat II diesel. While the oil firms are in a position to supply low sulphur petrol to meet Bharat II standards in all parts of the country by April, they will be unable to do so in the case of diesel.

While the refineries within the country are having problems of their own, imports for the high quality diesel are also unavailable. Most of the products have already been contracted. Hence, the petroleum ministry might be forced to seek an extension of six months on Bharat II diesel across some parts of the countries, the official added.

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Oil firms, which are being pushed by the government to stick to the deadline in all the above cases have an uphill task.

According to a senior IOC official, with the present restructuring of duties in the budget, marketing firms will come under pressure from high excise duties. The oil firms are further hit as they can’t pass on the hike and the additional road cess of 50 paise per litre to the customers. For the 2004-05 fiscal, the burden on IOC alone is estimated to be around Rs 6,000 crore.

In addition, there will be the burden to import low sulphur content products, which will push up the cost further, an IOC official added.

Aiyar to approach Cabinet on prices

NEW DELHI:

The petroleum ministry will approach the Union Cabinet on revising petrol and diesel prices as a fallout of budget proposals. “I am readying myself to go to the Cabinet to secure instructions as how to proceed further. This will take a few weeks time. Till such time, there will be no change in prices,” Oil and Petroleum Minister Mani Shankar Aiyar told reporters on Tuesday.