Oil marketing companies on Tuesday cut the retail price of petrol by Rs. 1 a litre. An expected reduction in diesel prices — which would be the first cut in over five years — has been kept on hold pending assembly elections in Maharashtra and Haryana.
This is the second cut in petrol prices this month, after a by 54 paise per litre cut on October 1, as international crude oil prices continue their downward trend, even though an appreciation in the rupee makes oil imports costlier.
The price revision was due on Wednesday evening but was announced on Tuesday ahead of polling.
After accounting for local sales tax, petrol will cost Rs. 66.65 per litre in Delhi, a cut of Rs. 1.21, according to Indian Oil Corp (IOC), the nation’s largest fuel retailer. In Mumbai, the price is cut from Rs. 75.73 to Rs. 74.46 per litre.
Oil company sources said that the price of diesel may see a Rs. 2.50 per litre cut after the results of the assembly elections are announced on Sunday.
Diesel is India’s most consumed fuel. Any change in its price has a direct bearing on the prices of essential commodities. If its price is reduced, it is likely to have a cascading effect on commodity prices, further bringing down inflation rates.