Kathmandu - The Nepalese government on Tuesday raised oil prices for the fourth time in less than nine months, saying the hike was needed to bring Nepalese prices in line with international ones and tackle severe fuel shortages.

The hike came after India, Nepal's main supplier of petroleum products, raised prices recently, officials said.

The Nepalese government had been under pressure to raise prices amid months of worsening fuel shortages. The state-owned Nepal Oil Corp's inability to pay more than 2 billion rupees of debt to its main supplier, the Indian Oil Corp, was the main reason behind the shortages, which began last year.

Nepal Oil said it had raised prices of petrol by as much as 25 per cent and it would now cost 100 rupees (1.45 dollars) per litre.

The price of petrol has now risen by 37 per cent since the first hike was announced in October.

The government also raised prices of diesel, used by most public transport and long-haul buses and trucks, by 24 per cent per litre.

Domestic household consumers have also been hit hard after prices of kerosene and liquefied petroleum gas used for cooking were raised by as much as 27 per cent.

"The new prices come into immediate affect," Commerce Secretary Purosottam Ojha said. "It is clear that everyone has to share the burden of international oil prices."

However, debt-ridden Nepal Oil said the country was still incurring losses of nearly a billion rupees a month in the import and sale of petroleum products.

The Nepalese government said it would provide grants to the company to maintain adequate supply. It also decided to allow the private sector to import fuel for sale and distribution.

"The details of what type of fuel the private sector will be allowed to import for distribution still needs to be worked out," Ojha said.

For the past month, petrol pumps across Nepal have been distributing limited amount of fuel with motorists having to queue up for hours.

With declining reserves, the government earlier this week announced quotas, limiting cars to purchasing 12 litre of petrol at one time. (dpa)