Business Today

Petrol, diesel not even Re 1 lower after cut in prices for eight straight days

In last eight days, petrol price in the national capital has come down by 71 paise from its record high of Rs 78.43 on May 29. Before cutting the prices, oil marketing companies last month hiked the fuel cost for 16 consecutive days - from May 13 to May 29, petrol price was raised by Rs 3.8 and diesel by Rs 3.38 per litre.

twitter-logo BusinessToday.In        Last Updated: June 6, 2018  | 15:30 IST
Petrol, diesel not even Re 1 lower after cut in prices for eight straight days

Fuel prices on Wednesday witnessed eighth straight cut. Petrol price in Delhi was down by 11 paise to Rs 77.72.  Today's petrol price in Kolkata is Rs 80.37, down by 10 paise; in Mumbai Rs 85.54, cut by 11 paise and Chennai Rs 80.80, down by 12 paise. Diesel price has also come down by 8 paise to Rs 68.80.

In last eight days, petrol price in the national capital has come down by 71 paise from its record high of Rs 78.43 on May 29. Before cutting the prices, oil marketing companies last month hiked the fuel cost for 16 consecutive days - from May 13 to May 29, petrol price was raised by Rs 3.8 and diesel by Rs 3.38 per litre.

Indian petroleum prices are determined by the cost of crude oil in international market. Prices of crude oil began to shot up last year when the organisation of oil exporting countries decided to withhold the excessive output - which had brought down the prices to the lowest in more than a decade. The countries slashed the overall fuel supply by about 1.8 million barrels per day that created the shortage of crude which in turn spiralled the prices.

However, last month's spike in fuel prices was due to fear of potential new US sanctions on Iran and crisis in Venezuela.

But, this week it was reported that the members from OPEC Countries -- Saudi Arabia, the United Arab Emirates, Kuwait and Algeria -- met unofficially in Kuwait and agreed to lift the curb on crude supply. Following  the report, the US crude prices on Monday touched its lowest level in nearly two months.

The organisation of the petroleum exporting countries are slated to meet formally later this month to decide whether the group and non-OPEC members will raise production to ease concerns over potential supply shortfalls from Iran and Venezuela. Venezuela's crude oil production fell nearly 13 per cent last year due to intense internal conflict.  

Now, all eyes are on July 22 meet of OPEC countries as the outcome of this meeting will decide the future price of crude oil prices. Recently, Goldman Sachs and Morgan Stanley predicted that the crude oil prices could go beyond $80 per barrel. If crude prices go up as predicted then it would hit India really hard. India imports over 80 per cent of its crude oil requirement and it is the world's third largest oil importer.

Earlier, Oil Minister Dharmendra Pradhan said that the government was concerned about pinching fuel prices and is working on a long-term solution. He said that the present oil price jump is due to three main factors -  hike in the international price of crude, fluctuation in the dollar and Indian currency ratio, and some of the tax issues. The Central government levies Rs 19.48 excise duty on a litre of petrol.  

Youtube
  • Print

  • COMMENT
BT-Story-Page-B.gif
A    A   A
close