TNN

New Delhi, Dec 17: The government on Tuesday indicated that there was scope for the second instalment of reduction in motor fuel prices if the downward slide in international crude continues. “We will watch (crude oil) prices (to see) if further reduction is possible,” home minister P Chidambaram told the Rajya Sabha.

The government had earlier this month cut petrol price by Rs 5 a litre and diesel by Rs 2 per litre as crude dipped to about $45 a barrel from a peak of $147 a barrel in July.

Chidambaram said the government would look into demands for further reduction in auto fuel prices. The former finance minister was answering questions pertaining to the finance ministry on behalf of PM Manmohan Singh, who now holds the portfolio.

In a separate reply, oil minister Murli Deora said the December 6 reduction was only an “interim measure”. “Further reduction in the prices of petrol and diesel had not been found feasible (on December 6) in view of the continuing under-recoveries (losses) on sale of PDS kerosene and domestic LPG.”

Last week, TOI was the first to report that the government was looking at a revamp of the petro-tax regime to find a way to deliver the second instalment of the relief without hurting the oilmarketing companies.