After a steep hike of Rs 7.50 nine days ago, the UPA government’s decision to slash petrol price by Rs 2 shows nothing but its short-sightedness. Was the government unaware of continuous slumping of   crude oil prices in the international markets? Had the oil companies waited for 4-6 days to hike petrol prices, the government would have avoided the wrath of the common man, the Opposition’s criticism and Bharat Bandh. But it is difficult to understand that why did the UPA government, which had convinced the oil firms not to increase the petrol price for the two months just before the elections, failed to stop these firms for doing so till a week. It is believed that government delayed a partial cut in petrol prices for two days so that the Opposition could not take the credit of it. Whatever the truth may be, the government should not make pretext that it has no authority on the oil firms in regulating petrol prices. The logic bears no significance. The Central government and its policy makers should not make such tall claims as they give wrong message among the common man that the ruling dispensation is willingly hiding the fact.

The truth is that the government should not cite the losses of oil firms as the reason behind the hiking petrol prices as Overseas Indian Affairs Minister Vayalar Ravi himself said that the oil companies’ claim that they are running in losses seems to be untrue and these assertions should be probed. He said that the IOC and the BPCL made huge profit this fiscal in comparison to the previous one. This apart, it has revealed that the expenses and salaries of the state-run oil companies are at par with firms which have highest expenses. In that context, why it should not be considered that the oil firms are claiming for losses, while they spend exorbitantly?  The country would like to solve the puzzle that the state-run oil companies are running in huge losses while some of them are claiming to have made huge profit. Is this profit an outcome of subsidy given by the government to the oil firms? It’s million dollar question that the IOC's net profit in the last quarter was Rs 12670 crore, three times more than the net profit in the same quarter previous year. Does this Navaratna Company depend mainly on government subsidy? The government can blame the Opposition that they are trying to gain political mileage by opposing the petrol price hike, but it should ponder over the statements of its own senior ministers who are not only terming the price hike irrelevant but also questioning the oil firms’ claim of incurring huge losses. It would be better that the Central government should make an arrangement for rational fuel price system in the country.