No change in LPG, fuel prices till May

The UPA government will not raise prices of petrol, diesel, LPG and kerosene before mid-May, when Assembly elections in five states get over. After that, it plans to allow increase in auto fuels by shifting them to a 8216;free float8217; without any government intervention.

If that political plunge is taken, it would give oil marketing companies the freedom to fix consumer prices of petrol and diesel in line with the global levels. Officials said at end-February, this would translate into an increase of Rs 1.52 per litre of petrol and Rs 2.26 on a litre of diesel in Delhi.

As for LPG and kerosene, the government plans to hold their prices at present levels while continuing the current system of burden-sharing where upstream companies ONGC, Oil India Ltd and GAIL bear one-third of the under-recoveries on both products; oil marketing companies absorb one-third; and the government issues bonds for the remaining one-third.