Don't levy sales tax on fuel: Centre

New Delhi: The Centre on Saturday reiterated that there would be no rollback on fuel prices.

The Centre has asked states not to levy sales tax on the incremental component of fuel prices to reduce burden on the common man.

"As of now there is no scope for reconsidering the decision. I don't see any possibility of a rollback," Petroleum Minister Murli Deora said.

He also refused to give any promise that the fuel price would not be hiked in the near future.

"It all depends on the international crude prices," said Deora.

Deora added that crude prices stood at $68 per barrel now. Centre had hiked petrol prices taking crude prices at $54.5 and left the rest uncovered.

The oil marketing companies, which had a net worth of Rs 41,500 crore, had registered an 'under recovery' of Rs 73,500 crore.

However, if the prices had not been increased the entire net worth of these companies would have been wiped out in a couple of years.

The recent price hike had only accounted for one eighth of the under recovery, he said.

The oil companies, which had a profit of Rs 11,000 crore three years back, had a profit of Rs 5,410 crore last year.

If the prices were not increased, the profit would have come down to Rs 57 crore in the current fiscal, Petroleum Secretary M S Srinivasan said.

Srinivasan said that the fuel price hike had passed only 16 per cent of the burden of oil companies to the common man. The rest of the burden would be borne by the Centre and oil companies themselves.

India, which produces only 25 per cent of its crude oil needs, depends heavily on imports.

To meet the needs, Indian oil companies were present in 15 countries like Sudan, Vietnam, Nigeria and Ecuador for procurement of crude, he said, adding that ten more countries would be added to the list very soon.

"Even after the hike, petrol and diesel prices were cheap as compared to neighbouring countries of Nepal, Pakistan and Sri Lanka," he said.

On bio diesel, he said the Petroleum Ministry had already announced the procurement price for bio diesel and over 25 centres were opened for procurement.