The government has not yet officially asked India’s biggest oil explorer, Oil and Natural Gas Corporation Ltd., to bear a subsidy on auto fuel.
“There has been no communication over subsidy sharing as far as ONGC is concerned,” Chairman and Managing Director Shashi Shanker said at a press conference in New Delhi today. “There hasn't been any discussion with the government for a long-term solution to the fuel price hike.”
Stocks of oil producers, especially those of ONGC and Oil India, fell after newswire agency PTI said in a report that the government may levy a windfall tax on ONGC as part of a long-term solution to moderate spiralling retail prices of petrol and diesel.
Fuel prices were hiked over a 16-day period in the range of Rs 3.22-3.99 per litre in the four metros, as Brent crude prices rose and the the rupee weakened against the U.S. dollar. After the global oil price rally stalled, prices were cut marginally yesterday and today.
Before fuel price deregulation, public sector oil companies bore the subsidy burden on petrol, diesel, kerosene and liquefied petroleum gas, which was stopped by the government after crude oil prices crashed.