Petrol prices inch closer to Rs 100/litre

Mumbai, May 18: Petrol prices are reaching the Rs 100-mark at a rapid pace.  The rise is being fuelled by a surge in crude oil prices. With the current spurt in crude prices, petrol has already crossed the Rs 80 mark, and are slated to rise further.
Petrol has reached Rs 75.32 per litre in the national capital. With this, the price of petrol in Delhi inched further close to the previous high of Rs 76.06 a litre, reached in September 2013. In the other major cities of Kolkata, Mumbai and Chennai also petrol was priced at multi-year highs on Thursday -- Rs 78.01, Rs 83.16 and Rs 78.16 per litre, respectively.

The previous highs in these cities were Rs 78.03 (Kolkata, August 2014), Rs 83.62 (Mumbai, September 2013) and Rs 79.55 (Chennai, September 2013) respectively.

Similarly, prices of diesel -- the fuel largely used for transportation of food and agriculture products and in turn affecting inflation -- also rose to fresh all-time high levels across metros.

In Delhi, Kolkata, Mumbai and Chennai, diesel was priced at Rs 66.79, Rs 69.33, Rs 71.12 and Rs 70.49 per litre, respectively -- all at unprecedented levels.

The benchmark international rate for petrol has further risen to $83.30, indicating larger daily price hikes would be needed to level retail price with cost. Similarly, benchmark international diesel rates during April 24 and May 14 have climbed from $84.68 per barrel to $88.93. Also, the rupee has weakened to Rs67.06 per US dollar from Rs66.62, making imports costlier.

Prices of transport fuels are now changed on a daily basis, unlike the previous norm of fortnightly revisions.

However, the Indian Oil Corporation had suspended the dynamic pricing system for 19 days, "to avoid creating unnecessary panic among the consumers", until resuming it on Monday, May 14.

In addition, the high rate of excise duty has also contributed to the rise in prices.

In the Union Budget 2018-19, the government had reduced the basic excise duty on petrol and diesel by Rs 2. The government also abolished additional excise duty on fuel. But to compensate the move on the fiscal front, it increased the road cess to Rs 8 per litre.
News24Bureau with Agency inputs