Natural Gas pricing at the crossroads

In April 2002 the Union Government announced, with great fanfare, the dismantling of the Administered Pricing Mechanism (APM) for petroleum products. Refineries were to price their products at import parity and marketing companies were free to add their marketing margins. This freedom was short lived and marketing companies soon had to seek the Petroleum Ministry's approval for any hike in prices of transportation fuels, as well as subsidized domestic fuels, i.e. kerosene and LPG. These two segments account for nearly 50% of the total sale of petroleum products. Recently, because of very high crude prices, the Ministry has also put a cap on ex-refinery prices. The Petroleum Minister, not being afraid of calling a spade a spade, has said that there never was any dismantling of the APM. Full Text