People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 21

June 08 , 2008


Fuel Price Hike Thoroughly Unjustified: CPI(M)

The following press release was issued by CPI(M) on June 04, 2008

THE hike in the prices of petrol, diesel and LPG announced by the government today is unjustified. If the suggestions put forward by the Left parties are taken into account, this price hike would be totally unnecessary.

The government has said that the price hike would lead to additional earnings of Rs 21,123 crore for the Public Sector Oil Marketing Companies (OMCs). This amount can be easily mobilised to provide relief to the OMCs by doing the following:

The astronomical figures for under recoveries of OMCs that are being projected as their losses by the government are notional figures. They are not actual losses. The government should realise that in a global context where price of crude oil is reigning at a high level, the only sustainable solution lies in restructuring duties on petro products and having a transparent pricing policy whereby the OMCs as well as the refineries do not retain hefty profit margins. What is at stake today is not the market capitalisation of the oil companies but the livelihood of the working people who are already suffering from back-breaking inflation.