Supplies Minister says fuel prices adjusted to ease the supply system

The government has given explanation that the price of petroleum products had to be adjusted to ease the supply system.

Minister for Industry, Commerce and Supplies Dilendra Prasad Badu gave this explanation seeking time from the Speaker to make a statement of public importance in the meeting of the House of Representatives today.

He said that the Nepal Oil Corporation was faced with the situation of making adjustments to the price of petroleum products as per the cost price for easing the supply system since it is seen that the amount which has to be paid to the Indian Oil Corporation (IOC) for the purchase of petroleum products has been piling up.

Stating that the price of petroleum products has been constantly going up in the international market, Minister Badu said the NOC's losses would shoot up if the fuel price is not adjusted at a par with the international price while keeping the interest of the general public in mind. He said the NOC's losses until June 14 has been around Rs 50 billion its dues to IOC amount to Rs 22 billion.

He said the government has adopted the policy of providing concession on electricity tariff to increase electricity consumption and decrease the use of LP gas for cooking purposes by the general public. Similarly, the government has the policy of providing tax concession for promoting the use of electric gadgets and electric cooking stoves.

He also urged the consumers for judicious use of petroleum products and in the implementation of the policies and programmes brought by the government for the smooth supply and rational use of fuel.

"The price rise is a compulsion. The government is sensitive regarding the inconveniences faced by the people due to this. The government is also pained while having to increase the prices of fuel," the Supplies Minister said.

Stating that the price of petroleum products in the pricelist which the NOC has been getting from the IOC is most of the time found increasing of late due to the global energy crisis created as a result of the Russia-Ukraine conflict, Minister Badu said the NOC has been selling the petroleum products even by incurring losses.

He informed the parliament that the government has, as per the proposal forwarded by the Ministry of Industry, Commerce and Supplies, decreased the price of petroleum products by Rs 10 per litre on the retail selling price, keeping in mind the inconvenience caused to the general public due to the recent hike in the fuel price. This is in line with the government's goal of decreasing the prices by making adjustment to the tax imposed on the petroleum products to provide relief to the consumers, he added.

The Supplies Minister also informed the House that a policy decision has been made by which the government entities will be required to reduce the consumption of petroleum products by at least 20 per cent.