State-owned oil retailers Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) have launched a pilot to revise petrol and diesel prices on a daily basis in five select cities - Udaipur, Jamshedpur, Chandigargh, Vizag and Puducherry.
On May 1, petrol price in Vizag stood the highest at Rs 72.68 per litre, followed by Udaipur at Rs 70.57/litre and Jamshedpur at Rs 69.33/litre.
Petrol Prices (per litre):
Udaipur: Rs 70.57
Jamshedpur: Rs 69.33
Chandigargh: Rs 67.65
Vizag: Rs 72.68
Puducherry: Rs 66.02
Diesel Prices (per litre):
Udaipur: Rs 61.23
Jamshedpur: Rs 60.26
Chandigargh: Rs 57.74
Vizag: Rs 62.81
Puducherry: Rs 58.68
Meanwhile, petrol and diesel prices were hiked nationwide by 1 paisa and 44 paise per litre respectively on Monday.
"The current level of international product prices of Petrol & Diesel and INR-USD exchange rate warrant increase in selling price of Petrol and Diesel, the impact of which is being passed on to the consumers with this price revision," IOC said in a press release.
The decision to revise prices on a daily basis has been made to cope with volatility in prices of global crude oil.
State-owned OMCs IOC, BPCL and HPCL, which own more than 95 per cent of the nearly 58,000 petrol pumps in the country, hope gradually extend the pilot to other parts of the country.
"The movement of prices in the international oil market and INR-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price change," the IOC added.
Previously, petrol and diesel prices were revised on a fortnightly basis as per average international price of fuel in the preceding fortnight taking into consideration the currency exchange rate.
However, now the prices will be in sync with international rates like it operates in most advanced markets.
The corporations will now set prices that will reflect real-time movement in international oil prices and rupee-US dollar fluctuations.
IOC said customers may verify fuel prices by downloading the company app or visiting its website.
Daily price change will remove the big leaps in rates that need to be effected at the end of the fortnight and consumer will be more aligned to market dynamics.
While petrol price was freed from the control of the government in June 2010, diesel rates were deregulated in October 2014.
Technically, oil companies have freedom to revise rates but often they have been guided by political considerations.
Rates differ by only a few paise between pumps of the three state fuel retailers.
With daily changes, which are unlikely to be more than a few paise per litre, the political pressures for not revising rates particularly when they are to be hiked will go, industry sources said.