Price of fuel may increase by 15%

According to the general director of the State Trading Corporation (STC), Megh Pillay, a go up of 15 per cent is expected.

The final verdict on the oil products will be known by the end of the week. The Petroleum Pricing Committee will meet up on Wednesday and it will replace the Automatic Pricing Mechanism (APM).

The State Law Office has already finalised the new policy and the committee can start its work.

Now, the price of petrol is at Rs 44.70 per litre and could shortly cost around Rs 51. The price of diesel which is Rs 35.50 could be more than Rs 40. The prices are calculated by the price of Cost, Insurance and Freight (CIF), government tax, profit margin of different distributors, filling stations, the VAT and adjustment of the Price Stabilisation Account.

Pillay stressed that the last APM met in October 2010. “The price of petrol keeps on increasing on the international market,” he said. The price of a tonne of crude oil has increased from $74 to $100. On the international market, the prices raised by 23 per cent due to the growing consumption in Europe and the cruel winter prevailed in December.

Pillay underlined that the Petroleum Pricing Committee (PPC) will meet once every four months to review the price of petrol and diesel if necessary. This committee will be led by the director of the statistics office and will comprise of various professionals and representatives from the Ministry of Industry, Finance and Prime Minister’s Office.

The decision of the PPC will be transparent and will be published on the website of the State Trading Corporation. At the Ministry of Industry and Commerce, a permanent monitoring committee will be established to monitor the situation daily and the data on petrol will be available on the website of the ministry.