The government has deferred a decision on raising diesel and cooking gas prices to compensate state-owned oil marketing firms for revenue losses on selling these products below market prices.
New Delhi may have got cold feet on the sensitive political decision after a spurt in food inflation.
But crude prices touched a 26-month high of almost $92 per barrel last week, raising the possibility of increasing the government's subsidy burden this fiscal year.
In June, the government freed up petrol pricing and raised the prices of other fuels and followed it up with another hike in petrol prices in early December.
Here are the possible scenarios for diesel pricing:
Image: An employee counts Indian currency at a fuel station in Mumbai
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