The government’s policy on Emission, Euro IV and Euro III would find the hike in the cost of petrol and diesel from April- 50p- 1 rupee. The norm will come into effect in 11 cities from April under Euro IV and as Euro III in other parts of the country. The oil agencies have prompted the hike with the government. Four years ago, Delhi, Mumbai, Hyderabad, Kolkata, Chennai and Agra came under this scheme with the price increasing by 30paise for petrol and 24 paise for diesel.

The current price of petrol in Delhi is Rs44.63 and Rs48,76 in Mumbai while the cost of diesel is Rs32.87 and Rs36.07 respectively. The oil agencies have invested Rs28000 crore to upgrade the fuel refineries and are seeking market margin with the back up of the government. The Euro IV fuel consists of less volume of carbon and due to this, the oil retailers will have to shell out gross revenue of Rs3.49 for a lit of petrol, Rs2.38 on diesel, Rs18.13 on kerosene and Rs250.67 on LPG cylinder of 14.2kg. the PSUs  might incur a loss of revenue to Rs45478 crore in this FY.

The Auto Fuel Policy is the result of the Supreme Court’s mandate for Euro IV compliance. Various refineries have spent amount to upgrade them- Mangalore Refinery, a subsidy of ONGC, has spent Rs8000 crore to yield a capacity of 15 million ton per annum from the current 9.69mtpa. HPCL spent Rs4000 crore for its refineries in Mumbai and Vishakapatnam; IOC’Rs12000 crore will be for its seven refineries. BPCL spent Rs4300 crores for its two refineries Mumbai and Kochi. However, the OMCs expressed their reservations on meeting the Euro III norms within April and seek extension till July. The blessings of the apex court is to decide this. Except HPCL, other oil agencies are in the process of upgrading for Euro III.