E-Paper
Petrol past ₹95/litre in Delhi, ₹101 in Mumbai following 19th price hike
Mumbai has the highest fuel rates among the metros. Petrol is currently sold at ₹101.25 per litre in the financial capital and diesel at ₹93.30 a litre.
Fuel rates continued to move up in small amounts for the nineteenth time in 34 days making petrol costlier by ₹4.63 per litre and diesel ₹5.22 across the country since May 4, a day after results of five assembly polls were declared.
State-run oil companies raised petrol price by 27 paise and diesel by 29 paise on Sunday, taking auto fuel rates to yet another record. Petrol in Delhi is priced at ₹95.03 per litre on Sunday and diesel at ₹85.95 a litre. 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.
The upward movement since May 4 saw petrol prices breach ₹100 mark in various cities across the country, particularly in Maharashtra, Rajasthan, Andhra Pradesh and Madhya Pradesh. Some of the cities where the fuel is selling for over ₹100 per litre are Mumbai, Ratnagiri, Parbhani, Aurangabad, Jaisalmer, Ganganagar, Banswara, Indore, Bhopal, Gwalior, Guntur and Kakinada.
Mumbai has the highest fuel rates among the metros. Petrol is currently sold at ₹101.25 per litre in the financial capital and diesel at ₹93.30 a litre.
Surging international oil rates and high domestic taxes are two key reasons for the high fuel rates.
Indian fuel retailers align pump prices of petrol and diesel with their international benchmark rates of the previous day. Benchmark Brent crude, which fell marginally by 0.06% at $71.31 per barrel on Thursday, gained 0.81% on Friday close at $71.89 a barrel.
Pump prices of fuels are also high because of taxes. In Delhi, Central levies account for 34.8% of petrol’s price and state taxes, 23.08%, according to an official data of June 1. On diesel, Central taxes are over 37.24% while state taxes are about 14.64%. 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.
Even as international oil prices saw volatility in the last one month, pump rates of auto fuels in India moved only in the upward direction. For instance, despite Brent crude plunging to $65.11 on May 20, the lowest in these 34 days; petrol and diesel rates went up the next day by 19 paise per litre and 29 paise a litre respectively.
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, state-run retailers also reduced petrol and diesel rates by 77 paise and 74 paise a litre respectively. 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 — Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL)— control almost 90% of the domestic fuel retail market.
