Mixed reactions by industry to rise in oil prices

Mixed reactions by industry to rise in oil prices
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First Published: Wed, Jun 04 2008. 05 51 PM IST
Updated: Wed, Jun 04 2008. 05 51 PM IST
New Delhi : The financial community, oil companies consumers have taken the price hike with a pinch of salt.
Sarthak Behuria, IOC chairman: The package announced addressed the liquidity and profitability issues faced by retailers
RS Sharma, ONGC CMD: There will only be a marginal impact on the company’s revenues, while decisions will remain revenue neutral for ONGC.
Hitesh Agrawal, head, research, Angel Broking: The government’s move has been largely in line with what was expected in the wake of rising global crude oil prices, which have been hovering in the $125-130 a barrel range.
Given that the government is to face an election in the coming months, the price hike is a courageous move. However, considering the pressure that has mounted on the government and oil marketing companies in terms of subsidies and under-recoveries respectively, the price hike and duty cuts will play only a small role in salvaging the situation for the parties concerned.
Amitabh Chakraborty, president, equity, Religare: The hike is too little, too late. But, the government has done its best when the international crude oil prices are at all-time highs.
FICCI: FICCI has welcomed the price hike as it has cushioned that the pressures that oil marketing companies have been facing for some time. The government has taken a multi pronged approach with reduction in customs and excise duties. The result is that the burden has been shared equally. There is a further scope for rationalization and reduction if one takes the state level taxes into account.
Confederation of Indian Industry (CII) president KV Kamath: Fuel price hike was unavoidable, but necessary. Government sharing the burden is a great signal for the industry. We need a long term oil strategy though. The reduction of customs duty and specific excise rate is a welcome measure and shows the government commitment to share the burden of increased global prices
PHD Chamber of Commerce (PHDCCI) president L K Malhotra: Measures announced by the government including the increase in fuel prices are on expected lines. This will help oil companies in cutting losses on sale of petrol, diesel and LPG. The government has done well to simultaneously announce excise and customs duty cuts on petroleum and diesel to mitigate the impact of the hike on inflation.
Consumer, Piyush Bahl, entrepreneur: It is something that was anticipated. It will make us spend more on petrol but at the same time, given the international fuel price scenario, this is something that the Government had to do. We spent Rs4000-5000 on petrol every month. I see the same going up by 25%. More than the cost of petrol, I am worried about the cascading effect of the hike. One expects that food prices, eating out, couriers, and other such services will get only more expensive. As such, one will have to spend more at all levels.
Consumer, Suman Saurav, PR executive: Long drives are completely out. I will try and use my bike more often. I am also considering the option of getting my car converted to CNG as it works out cheaper for running. I spend Rs4000-5000 on petrol every month. I expect it to go up by 25% or more.
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First Published: Wed, Jun 04 2008. 05 51 PM IST
More Topics: Oil Price | Price Hike | Petrol | Diesel | Reactions |