Petrol price woes in India are not going to end anytime soon. Oil companies, which had raised Rs 7.5 per liter over a week ago, announced a rollback of Rs 2 Saturday after wide protests against the hike. However, the companies Monday said that the prices would be reviewed June 15.

In an interview to the CNBC-TV18, PK Goyal, director of finance at the Indian Oil Corporaton (IOC), said that oil companies would keep adjusting the petrol rates and would review prices again June 15. The next price review by oil companies might lead to another hike in the prices of petrol, dealing a bigger blow to the Indian economy and the people struggling with high inflation.

Prices of petrol in India have been deregulated since June 26, 2010. Oil companies review the prices and fix them according to the international market rates.

The oil companies have been strongly criticized for hiking the petrol price at a time when the price of crude oil dropped in international markets. However, oil marketing companies (OMCs) argue that petrol prices in India are not fixed on the international crude prices but are linked to the petrol prices in the dollar exchange rate. Therefore, the value of the rupee also determines the rate of petrol.

Despite crude prices having fallen sharply in the global market, the depreciation of the Indian rupee has nullified the benefit oil companies would have got.

When we had increased prices, since then crude prices have fallen from USD 124 to USD 115 but exchange rate has increased from USD 53.17 to 54.96. So as an affect of both the items, we are able to reduce the Rs 1.68 at Delhi and now we have no under recovery and over recovery, Goyal said in the CNBC-TV18 interview.

On Friday, the Brent crude prices dropped to a 16-month-low of $100 a barrel.

The OMCs were also accused of misleading on their losses, as all the three state-run oil retailers posted a combined profit of Rs. 61.77 billion for the year 2011-2012. However, the three OMCs, IOCL, HPCL and BPCL jointly issued a statement Sunday to counter these allegations.

A false impression is being created in some sections that the Oil Marketing Companies (OMCs) have recorded huge profits in 2011-12. On the contrary, the OMCs have been incurring huge losses, said the CEOs of the OMCs. They added that the reports depicted profits because of the huge assistance they got from the government and upstreaming oil companies in the form of grants.

It is only after the assistance of Rs. 83,500 crore from the Government and Rs. 550,00 billion from the upstream oil companies (ONGC, OIL and GAIL), totaling Rs.138,500 billion, the three Public Sector OMCs could declare nominal profits, the statement said.

Nevertheless, the statement put forward by the OMCs is an indicator that petrol and diesel prices can see another hike if the rupee devaluation against the dollar continues. It remains to be seen how appreciative the government will be of another rise in fuel prices, considering the extent of political complexities involved.