"To my mind, the government will wait till February before making another round of price cuts," a senior Petroleum Ministry official said.

Earlier this month, the government reduced petrol price by Rs 5 a litre and diesel by Rs 2 per litre as international crude oil prices dipped from an all-time high of $147 a barrel in July to under $45 a barrel.

"This period (till February) will be used to monitor the movements in international prices. There is no point in cutting fuel prices just now and then having to raise it again if oil makes a retreat," the official said.

Even after this months price cut, public sector oil firms were making a profit of Rs 9.98 on sale of every litre of petrol and Rs 1.03 per litre on diesel. The further softening in global oil prices has seen these profits widen to Rs 11.48 per litre on petrol and Rs 2.92 a litre on diesel, he said.

The oil companies, however, continue to lose Rs 17.26 per litre on PDS kerosene and Rs 148.38 per domestic LPG cylinder.

Indian Oil [Get Quote], Bharat Petroleum and Hindustan Petroleum are together projected to lose Rs 1,10,381 crore (Rs 1103.81 billion) in revenues this fiscal on fuel sales, the official said, adding the oil firms can use the period till the next price cut to make up part of the losses they have incurred on fuel sales this fiscal.

The three firms had posted a combined net losses of Rs 14,431 crore (Rs 144.31 billion) during the first six months of 2008-09.

The official said Petroleum Minister Murli Deora had on December 6 himself stated that the price were an "interim measure".

"Further reduction in the prices of petrol and diesel had not been found feasible on that day in view of the continuing losses on sale of PDS kerosene and domestic LPG," he said.

The combined borrowings of the three fuel retailers - IOC, BPCL [Get Quote] and HPCL [Get Quote] - at the end of November 2008 stood at Rs 1,15,000 crore with an interest burden of Rs 8,100 crore (Rs 81 billion) during 2008-09, he said. "The financial health of the OMCs needs to be protected for ensuring the energy security of the country."

The basket of crude oil India imports averaged $79.25 per barrel during 2007-08 and it went up to $142.04 a barrel on July 3. "International prices have come down since August 2008 and the average price of Indian basket of crude oil during November 2008 was $50.91 per barrel and the average price during 2008-09 (up to December 10) was $100.34 per barrel," he said.

"But, the benefit of softening of international oil prices has been partly offset by the recent depreciation of the rupee by around 25 per cent," he added.