Thursday, June 9 2005 12:22 Hrs (IST) - World Time -

New Delhi: In view of the uncertainty in the world oil prices, Government today (Jun 9, 2005) promised to keep a watch on inflation to ensure price stability in the country.

"Inflation needs to be watched carefully given the uncertainty in oil prices," Chief Economic Advisor Ashok Lahiri told reporters in New Delhi on the sidelines of a World Bank workshop.

He asserted that Government as well Reserve Bank of India were committed to price stability.

The statement assumes importance in the wake of global oil prices soaring to near $55 a barrel yesterday (Jun 8, 2005) after US Government said America's commercial petroleum inventory fell sharply last week.

However, In India, the widely tracked Wholesale Price Index (WPI) inflation had been sliding continuously in the recent times and the latest figure stood at 5.38 per cent for the week ended May 21.

Oil Public Sector Units (PSUs) have so far not raised prices since November due to reasons other than economic and Petroleum Minister Mani Shankhar Aiyar had said it was for Prime Minister Manmohan Singh to decide after his recent meeting with Singh and Finance Minister P Chidambaram.

However, Left Parties, crucial outside supporters of the United Progressive Alliance (UPA) Government, have opposed the oil price hike.