Govt To Review Oil Prices In...

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[Government will again review retail fuel prices in October, even as it expects crude import bill to shoot up to $110-120 billion this year on the back of record oil prices. &quot;At the time of Cabinet decision in June (on oil price hike), we agreed that we will take stock of the situation in October. We do not expect any price revision between now and October,&quot; Petroleum Secretary M.S. Srinivasan said in Madrid on Thursday. On June 4, when global crude prices were hovering around $135 a barrel, the government announced an increase in prices of petrol and diesel by Rs 5 and Rs 3 per litre respectively to bail out state-run oil marketing companies from a financial mess. Click On OIl Muddle: Complete Coverage International oil prices on Thursday climbed to a record $%145 a barrel, and a fresh revision in retail prices could further fuel inflation that is already at over 13-year high of 11.42 per cent. &quot;It (import bill) will go up if the prices rise further,&quot; Srinivasan told reporters on the sidelines of the 19th World Petroleum Congress. In 2007-08, India's import bill was $67.988 billion. This year, the import would be higher because Reliance Petroleum's export oriented 29 MT refinery is set for commissioning in August-September. He said fuel consumption growth will be 5-6 per cent, but if the current pricing policies continue, wherein auto fuels are cheaper than industrial fuel like naphtha, the demand may go up because there is a tendency for power generators to switch to diesel instead of fuel oil and naphtha for electricity generation. Srinivasan also said the world should be thankful to India for its surplus fuel refining capacity, but for which global fuel prices would have been even higher. &quot;There is a shortfall in global refining capacity... Not been adequate investment in refining capacity addition globally in the past 20 years. &quot;This serious imbalance between refining capacity and demand is the primary reason for unacceptable high prices of gasoline and diesel the world over,&quot; he said. India's strong reaction came after a report by the US-backed International Energy Agency questioned India's move to allow private sector refiner Reliance Industries to export fuel when the country was forced to import petroleum products to meet surging domestic demand. &quot;Here is one country that is refining more crude than is needed for its consumption, and resulting in correcting the supply imbalance globally,&quot; Srinivasan said, noting that this surplus capacity has had a sobering impact on gasoline and diesel prices globally. &quot;I do not agree with the IEA's observation on our export oriented refineries,&quot; Srinivasan said. He said the spread between raw material and finished products like gasoline and diesel is the result of lack of surplus refining capacity globally and this spread is rising due to lack of refining capacity addition elsewhere. IEA had noted that India, whch imported 22.716 million tonnes of petroleum products in 2007-08, may not initially see much benefit from the (RPL) refinery start-up, given the export status that the refinery has. (PTI)