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Nepal hikes petrol prices after shortages

KATHMANDU, Nepal, Dec 26, 2007 (AFP) - Nepal's state-owned oil company on Wednesday hiked petrol prices by nearly 10 percent, the second increase in the last two months, to meet a rising import bill in the landlocked nation, officials said.
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Shah said there would be a gradual improvement in supplies in the next few weeks. "The price of petrol has been increased with immediate effect to meet the rising costs in the international market," Nepal Oil Corp spokesman Icchha Bikram Shah told AFP.
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In October the company, which enjoys a monopoly on oil distribution in Nepal, increased the price of petrol by 9.

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0 percent, diesel by 5.0 percent, kerosene by 6.0 percent and gas used for cooking by 22 percent.
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Shah said the price of other oil products would also go up in the "next few days."

Nepal Oil sells fuel products below cost and as a result has recorded average monthly losses of 5.9 million dollars for more than a year.

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Shah said that with the price hikes the company would make a monthly profit of around 470,000 dollars.

Landlocked Nepal has no oil reserves and relies on its giant southern neighbour India to truck in petrol, gas and other fuel.

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But supplies have been tightened after the impoverished Himalayan country failed
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