New Delhi: Brace yourself for another hike in diesel prices as the Central government is in no mood to further dilly-dally over the issue of regulating diesel price. Notwithstanding the ongoing political repercussions, the Centre is all set to issue another hike in the price of diesel which it had been postponing till now.

Fearing interruptions in the supply of petroleum products following the huge loss incurred by oil companies, a meeting of the top officials of Finance and petroleum Ministry was held on Tuesday. In this meeting a roadmap to decontrol diesel was prepared.

According to sources, Petroleum Ministry has been pushing more for the hike. After taking into cognizance the gravity of the situation the Finance Ministry is also ready to act in this direction.

In the meeting, it was conveyed to the officials of Finance Ministry that the state-owned fuel retailers such as Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum are going to register their biggest ever loss for the first quarter (April – June) 2011. The results of the companies may push the already volatile share market towards recession.

The companies have been functioning with the aid of debt so far but after posting their quarterly results it may soon become difficult for them to take further loan. The oil companies have been bearing a loss of Rs 450 crore per day making it difficult for them to maintain the supply of petroleum products.

Meanwhile, Ministry of Finance is not in favour of complete deregulation of diesel prices which implies a hike of Rs 13 per litre in retail prices of diesel and a climb in the rate of inflation.

Speculations are rife that the government may increase the retail prices of diesel to an extent and look for other alternatives for bearing the rest of the losses.