New Delhi, June 4: On rocketing fuel prices, the government has ruled out the possibility of subsidising oil costs. Petroleum Minister Dharmendra Pradhan has reiterated the need to bring long-term policy reforms, which could regulate the petrol and diesel prices, irrespective of the volatile crude rate.

Here are four key options before the Narendra Modi government for taming the petrol and diesel prices.

Bringing fuel under GST regime: Petroleum products were kept out of GST ambit when the new taxation regime was implemented last year. Had the incumbent indirect taxes on petrol and diesel been replaced with the single-rate GST last year, it would had led to massive reduction in revenue for the state governments.

At present, nearly 50 per cent of the cost levied on per litre of fuel is constituted by various indirect taxes. If petrol and diesel is brought under the GST ambit, the tax rate would reduce to 28 per cent -- which is the highest tax slab under GST.

ONGC to cut down on profit: The state-owned refiner made 'windfall' gains after crude oil prices moved beyond $80-mark. The government has conveyed to the ONGC to cut down on its profit margin. In its lieu, analysts claim the government will ask for a lower dividend in form of taxes from the company.

Indian Commodity Exchange (ICEX): The in-principle nod to trade petrol and diesel as futures commodity has been given by the Petroleum Ministry. The clearance from Securities and Exchanges Board of India (SEBI) is, however, awaited. Under futures trading, the fuel could be pre-purchased for, say, the next 100 days at a predetermined price. The rationale behind the proposed move is to allow the market to determine the best fuel rate. At present, the price is regulated each day by the oil corporations based upon the crude oil rates.

Concession from OPEC: The Organisation of the Petroleum Exporting Countries (OPEC) countries sell crude oil to Asian nations at a costlier rate than it does to the Western nations. This lopsided method of charging has been questioned by several nations of the East, including India. The OPEC is under considerable pressure to offer the same sort of concession to the Asian nations.

Over the past six days, fuel prices have been reduced by nearly 45-49 paise. This was preceded by a hike on 16 straight days, raising the petrol and diesel costs by nearly Rs 9-10 per litre.

(The above story first appeared on LatestLY on Jun 04, 2018 05:25 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).