Chinmaya IAS Academy – Current Affairs Chinmaya IAS Academy – Current Affairs
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Are oil marketing companies recovering the Rs. 1 per litre price cut of October 4 which they had made on the Centre’s instructions and absorbed into their financials?While oil marketing companies (OMCs) deny that they are doing so, , analysts argue that the pricing mechanism is so opaque and complex that there would be no way to tell even if they were recovering it.The government had, in early October, said it would cut the excise duty on petrol and diesel by Rs. 1.5 per litre each, and that oil marketing companies would administer a further Rs. 1 per litre cut in the price.At the time, the OMCs had said that the total effect of this on their finances would amount to Rs. 4,000-Rs. 5,000 crore in this financial year.“The government asked OMCs to absorb that Rs. 1 cut in price, so there is no question of us recovering it,” Indian Oil Corporation said in response to queries from The Hindu . “We have given our calculations for what impact this would have fiscally.”
