Petrol price in Mumbai crosses ₹100 per litre, fuel rates rise for 15th time
Petrol price crossed ₹100 per litre-mark in Mumbai on Saturday as state-run retailers raised fuel rates for the fifteenth time in 26 days, raising petrol rates by 26 paise per litre and diesel by 28 paise.
The latest hike made petrol ₹3.54 a litre costlier and diesel ₹4.16 since May 4, a day after the results of the five assembly polls was declared.
While prices of auto fuels are at record levels across the country, diesel is currently sold at ₹92.17 a litre in the financial capital, the highest among metro cities. Pump prices of petrol and diesel in Delhi on Saturday also made a new record of ₹93.94 per litre and ₹84.89 a litre, respectively.
While fuel rates in Delhi are the benchmark for the entire country, retail prices of the two fuels differ from place to place because of variations in state taxes and local levies.
Consumers in several cities, particularly in states like Rajasthan, Maharashtra and Madhya Pradesh, are paying more than ₹100 for one litre of petrol. Some of the cities selling fuel over ₹100 per litre are Ratnagiri, Parbhani, Aurangabad, Indore, Bhopal, Gwalior, Jaisalmer, Ganganagar and Banswara.
Surging international oil rates and exorbitant domestic tax structure are two key reasons for high rates of petrol and diesel in pumps. Benchmark Brent crude rose marginally by 0.24% to $69.63 a barrel on Friday. Indian fuel retailers align pump prices of petrol and diesel with their international benchmark rates of the previous day. Even as international oil prices saw both upward and downward movements this month, pump rates of fuels in India moved only in the upward direction.
Pump prices of fuels are also high because of taxes. In Delhi, central levies account for 35.5% of petrol’s price and state taxes, 23%, according to official data of May 16. On diesel, central taxes are over 38.2% while state taxes are about 14.6%. Through 2020, as global crude prices fell, the central government raised excise duty on the fuel to shore up its finances. States too followed suit -- with revenues hit on account of the pandemic.
According to executives working in state-run oil marketing companies, pump prices are also high because companies were recovering their past revenue losses like the one suffered for 66 days since February 27 when rates were not raised because of assembly elections in four states and one Union territory.
During the 66-day pause on the rate hike, state-run retailers had also reduced petrol and diesel rates by 77 paise and 74 paise a litre, respectively in four small steps. But, the entire gains to the consumers were quickly reversed in the first four consecutive rounds of rate hikes starting from May 4.
The government deregulated the pricing of petrol on June 26, 2010, and diesel on October 19, 2014. Accordingly, state-run retailers are free to change pump prices every day. Public sector retailers — IOC, Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL)— control almost 90% of the domestic fuel retail market.