Kathmandu, February 17:

State-owned Nepal Oil Corporation (NOC), which had a monopoly on prices of petroleum products such as petrol, diesel and kerosene earlier, has deregulated the petro-prices effective from today.

Organising a press meet in the capital today, Dr Madhav Ghimire, chairman of NOC board said that deregulation of petroleum products was done on the basis of free market policy of government to involve private sector in ‘the distribution of petroleum products’. “From now onwards, NOC will not be responsible in fixing retail prices of petro products. Sellers and dealers will fix the prices,” Ghimire said.

However, NOC predicts the prices to go up, after the private sector takes charge of distribution. Umesh Dahal, executive chairman of NOC said that the deregulation of petro prices would help the NOC to reduce its loss from Rs 570 million to Rs 200 million per month.

Meanwhile, the NOC has not deregulated the prices of LPG and aviation fuel, he added. “NOC itself has increased the price of aviation fuel to Rs 55 from its earlier Rs 53 per litre.”

A ‘million-dollar-question’ to be noted is the ‘stability’ in petro-prices, after it is left to the private sector.” The prices of petroleum products would be adjusted as per the prices released on February 1, Dahal said. He said that NOC will fix prices at 10 customs points and depots. “Besides these fixed locations, the prices of petroleum products may differ as it is going to be fixed by the dealers themselves,” he added. According to him, per litre of petroleum products may differ from Rs 1 to Rs 2.50 depending upon the locations.

The fixed depots and customs points are Biratnagar, Birgunj, Amlekhgunj, Thankot (Kathmandu), Pokhara, Bhairahawa, Nepalgunj, Surkhet, Dhangadi and Dipayal. According to NOC, it has fixed Rs 64,230.40 per kilolitre for Kathmandu, diesel at Rs 51,028.57 per kilolitre and kerosene at Rs 45,842.87 per kilolitre. “NOC will monitor the quality and supply of petro products.”

The new initiative of allowing the private sector to determine prices would strengthen the competitiveness of the private sector and quality petro products’ distribution, Dahal said.

Prachanda Man Shrestha, joint secretary at the ministry of industry, commerce and supplies, on the occasion, said that the government’s initiatives to involve private sector in this field shows that the state is in the process of liberalising petroleum sector, which is a very essential daily commodity. At the same time, he urged everybody to strengthen monitoring mechanism for effective supply of petroleum products.

Dahal said that NOC has yet to clear its loan over four billion to various banks.