The ongoing plunge in global crude oil prices could spell some good news for domestic consumers of auto fuels, especially petrol. There is a possibility of a Rs 1 to 1.5 per litre cut in petrol prices, sources said on Monday.
Senior officials of oil marketing companies (OMCs) — Indian Oil, HPCL and BPCL — refused to come on record and stated that the possibility of any immediate decline in petrol prices will be evaluated only on August 15.However, they said that if the decline in global crude oil prices continue for another 15 days, petrol prices would have to be cut soon. Any fall in domestic petrol prices will also bring down inflation, that is a current source of worry for the government.
The current domestic price of petrol is Rs 63 per litre (in Delhi) and a steep fall in international crude oil prices will eventually result in a reduction in the petrol prices, which stands decontrolled in the country.
India imports 75% of its crude oil requirements and the volatility in its prices have been fuelling inflation, which stood at 9.44% in June.
Crude oil prices fell by more than 2% in Asia on Monday. While New York crude hovered at around $84 a barrel, brent crude stood at $106 a barrel.
“Despite all the negative news, we could see a rebound in oil, although it might not last for long,” said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.