Your wait for monthly diesel price hikes to end has just got longer. You will have to continue to bear this 50 paise a litre (without taxes) hike for the next 21 months or till August 2015.
A 50 paise monthly hike translates into 57 paise a litre increase in Delhi after adding taxes. The effective hike varies from state to state depending on different sales tax component.
Even after 11 hikes in diesel price that translates into an effective hike of Rs 6.62 a litre since January 17, 2013 — when the government decided to raise diesel prices in small doses of 50 paise a month — the losses of oil companies on diesel sales have again climbed to Rs 10.50 a litre.
This means that consumers across the country will have to bear the price hike till the time losses are completely wiped out.
“Underrecovery or revenue loss on diesel has risen to Rs 10.48 per litre from Rs 9.99 a litre in the first fortnight of December,” the petroleum ministry said in a statement on Monday.
This was mainly due to a marginal increase in diesel rates in global markets and the rupee value falling from Rs 61.78 to Rs 62.13 against the US dollar.
The losses on diesel had fallen to Rs 3.5 a litre in May 2013 but following the rupee’s fall against the dollar coupled with high global oil prices, these losses increased to Rs 14.5 a litre in September 2013.
The government, which controls pump prices of diesel, had in January given partial freedom to state retailers to raise consumer prices of the fuel in small doses every month until pump prices are aligned with global rates.
State-owned oil firms — IOC, HPCL and BPCL — calculate the desired retail selling price of diesel on the 1st and 16th of every month.