Kathmandu, November 2

The Nepal Oil Corporation’s board today revoked the corporation’s decision to jack up prices of petroleum products on a directive from the prime minister’s office.

“The board revoked NOC’s decision following the direction from the Prime Minister’s Office not to adjust fuel prices ahead of the elections,” a source at the Ministry of Supplies told THT.

Consequently, the NOC board directed NOC not to make adjustment to prices of petroleum products before the upcoming provincial and parliamentary elections.

With the recent increase in global fuel prices, the NOC management had decided to increase prices of petrol, diesel and cooking gas with effect from today. The state-owned fuel supplier had increased price of petrol and diesel by two rupees per litre and one rupee per litre, respectively, and price of liquefied petroleum gas by Rs 25 per cylinder.

NOC has been selling petrol and diesel at Rs 98 per litre and Rs 73 per litre, respectively, while one cylinder of LPG costs Rs 1,325 in the retail market.

Sources said that Prime Minister Sher Bahadur Deuba had directed Minister for Supplies Jayanta Chand not to increase fuel price citing that sudden increase in price of petroleum products might affect the upcoming elections. Following the direction, Minister Chand had directed NOC board to roll back its earlier decision to hike fuel prices.

Meanwhile, NOC management has already published a notice reverting its earlier decision to increase fuel prices.

Supplies Secretary Krishna Devkota said that NOC might adjust fuel price after the elections as the global fuel price has been increasing lately.

As per the current rate of petroleum products sent by Indian Oil Corporation — sole supplier of petroleum products to Nepal — NOC is bearing loss of almost Rs 200 million per month.

NOC has been bearing loss of Rs 240 per cylinder on LPG and Rs 2.25 per litre on diesel.

In the mean time, consumer-related organisations like Forum for Protection of Consumers’ Right and National Consumer Forum Nepal have welcomed the decision of the government to keep fuel prices unchanged.