Contrary to reports, Petroleum ministry has recommended total decontrol in petrol and diesel prices apart from a minimum hike in kerosene and cooking gas rates. This is in sync with recommendations made by high-level committee headed by Kirit S Parikh.

“Ministry (petroleum) has recommended that petrol and diesel prices should be deregulated and revised monthly,” said a top petroleum ministry official on Monday. “We have also proposed a minimal hike in prices of kerosene and cooking gas,” he added.

A Cabinet note has been moved for increasing fuel prices. When asked about the timeline for new policy implementation, the official said that government is seeking political consensus on freeing prices of petrol and diesel.

There are two options for deciding on fuel price hike. First, after getting a nod from all its allies, the Union Cabinet may take the final call in about ten days. Secondly, government may free auto fuel pricing from its domain in aftermath of Union Budget scheduled to be unveiled on February 26.

UPA government has set the ball rolling on fuel prices with Congress leadership consulting its allies on the issue. But allies, DMK and Trinamool Congress, are against any increase in prices. The centre is already under attack from opposition parties over high food prices that refuse to move southwards.

A meeting between petroleum minister Murli Deora and finance minister Pranab Mukherjee on Sunday on the fuel hike issue remained inconclusive.

A high-level committee headed by former planning commission member, Kirit Parikh, in its report, has proposed deregulation of auto fuel prices and increasing LPG prices by Rs 100 per cylinder and kerosene by Rs 6.