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Oil companies will hike petrol prices by about Rs 3.14 per litre from Thursday midnight. This is the second big hike in four months. The decision was taken after a meeting of the heads of oil companies.

Petrol prices have been raised because of the weakening of the rupee against dollar.

Oil retailers claim they are losing Rs 15 crore per day due to the big gap in global and domestic prices.

Indian Oil Corp (IOC), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) now lose Rs 2.61 per litre due to high international crude oil prices and with rupee touching two-year low against the US dollar, the losses have increased the cost of importing crude oil.

"After adding local taxes, the hike needed at retail level comes to over Rs 3 per litre," a top official at one of the three state-run fuel retailers said. Petrol price were last hiked by Rs 5 per litre on May 15.

Petrol price was freed from the government control in June last year but the retail rates have not moved in line with cost as high inflation rate forced the oil companies to seek 'advice' from parent oil ministry before revising rates. IOC, BPCL and HPCL have lost Rs 2,450 crore this fiscal on selling petrol below the cost.

Besides petrol, the three firms are losing Rs 263 crore per day on selling diesel, domestic LPG and kerosene below cost. Diesel is being sold at a subsidy of Rs 6.05 a litre, kerosene at Rs 23.25 per litre while domestic LPG rates are under-priced by Rs 267 per 14.2 kg cylinder.

Rupee fell to 48 per dollar on Wednesday for the first time since September 2009. "Every rupee depreciation, the under-recovery (revenue loss) increases annually by around Rs 9,000 crore," he said.

In Delhi, petrol costs Rs 63.70 per litre and it will shoot up to almost Rs 67 per litre.

In Kolkata, petrol is already Rs 68 per litre and with this decision it will go up to Rs 71 per litre.

Similarly for Mumbai, petrol prices will go up to almost Rs 72 per litre.

In Chennai too, it will cross Rs 70 per litre as opposed to the current rate of Rs 67.50.

In an immediate political fallout of the petrol price rise, UPA allies DMK and TMC have decided to boycott Friday's meeting of ministers on LPG, expressing their anger.