Deora meets Dr. Singh, seeks sharp hike to bail out OMCs Under-recoveries of OMCs could touch Rs. 200,000 crore this fiscal, Prime Minister told Stand-off between Petroleum, Finance Ministries figure in Manmohan-Deora meeting NEW DELHI: A crucial meeting of the Empowered Group of Ministers (EGoM) on petroleum has been convened for Wednesday to discuss proposals to hike the price of petrol and diesel, cut import duties on crude oil and lower excise on the two fuels. The decision to convene the EGoM, headed by External Affairs Minister Pranab Mukherjee, was taken by Prime Minister Manmohan Singh after a 30-minute meeting with Petroleum and Natural Gas Minister Murli Deora on Tuesday evening. The government has come under tremendous pressure from the state-run Oil Marketing Companies (OMCs) to raise fuel prices to offset the impact of skyrocketing crude prices. The Petroleum Ministry has been demanding customs and excise duty cuts. Mr. Deora reportedly pressed Dr. Singh for a sharp and immediate hike stating that OMCs had a limit on under recoveries. The stand-off between the Petroleum Ministry and the Finance Ministry over duty cuts and issuing of enhanced oil bonds to cover the losses of the OMCs has further aggravated matters. This issue also figured in the Manmohan-Deora meeting. Terming as serious the crisis in the oil sector, Mr. Deora is believed to have conveyed to Dr. Singh that if no solution was found, the under-recoveries of OMCs could touch Rs. 200,000 crore this fiscal. Beyond a certain point, even the oil bonds become meaningless and any further indecision would badly hurt the expansion plans of the OMCs in all over the country and abroad. The Petroleum Ministry had sought an increase of Rs. 15 and Rs. 10 in the price of petrol, diesel respectively to offset their losses. Mr. Deora may also consult UPA chairperson Sonia Gandhi.