A rise in petrol and diesel consumption can help the government cut cesses on the fuels by Rs 4.5 a litre without impacting revenue collections of FY21, and help cool off the pressure on inflation, domestic rating agency ICRA said on Friday. Petrol consumption is estimated to increase 14 per cent in 2021-22 and diesel by 10 per cent on the lower base, rise in mobility and economic recovery, ICRA said. The rating agency added that it will result in an additional Rs 40,000 crore in revenue for the government through higher collections of the cess.
The fuel price hike for the last 16 days had caused inconvenience and disappointment among the general public.
The government is considering pricing Euro-IV compliant petrol and diesel that is to be sold in 13 big cities from April 1, at marginally higher price than currently supplied lower-grade fuel, Oil Secretary S Sundareshan said.
State-owned oil companies are losing about Rs 4 per litre on petrol, industry officials said.
Petrol and diesel prices were on Thursday hiked by 80 paise a litre each, taking the total increase in rates in the last 10 days to Rs 6.40 per litre. Petrol in Delhi will now cost Rs 101.81 per litre as against Rs 101.01 previously while diesel rates have gone up from Rs 92.27 per litre to Rs 93.07, according to a price notification of state fuel retailers.
Cooking gas LPG price on Wednesday was hiked by Rs 15 per cylinder in line with a surge in international fuel prices. Rates of both subsidised and non-subsidised LPG prices were hiked, oil company officials said. Cooking gas now costs Rs 899.50 per cylinder in Delhi.
Petrol, diesel prices hiked by Re 1/ litre
State-owned oil firms on Tuesday decreased retail selling price of petrol and diesel by up to Rs 1.08 and Rs 1.18 per litre, respectively, in step with the global softening of crude prices.
Will rising tensions between US-Israel and Iran threaten crude oil supply through the Strait of Hormuz, putting India's fuel prices, imports, and economic stability at risk?
The three companies in separate presentations to the Kirit Parikh Committee on fuel pricing suggested immediate freeing of petrol and diesel prices from government control.
Petrol would cost Rs 33.49 per litre in Delhi while diesel Rs 22.12 per litre.
State-owned oil firms are losing Rs 1.32 a litre on petrol as international oil rates have firmed up during the last two weeks.
The government has no immediate plans to raise petrol and diesel prices even though raw material costs have surged to their highest level this year, Petroleum Secretary R S Pandey said on Thursday.
'The next two to three weeks will not be decided in Washington.' 'They will be decided in Tehran, in whatever calculation Iran makes about the costs of continued resistance against the costs of appearing to have yielded.'
An Empowered Group of Ministers (EGoM) may go with Oil Minister Murli Deora's proposal to free petrol prices from government control, which would trigger a hike of Rs 3.73 a litre, official sources said.
The purge in Washington does not pause the war. Strikes continue, Hormuz remains closed, and Brent crude is still dancing around $109 a barrel. For India, the command chaos in the Pentagon is another layer of uncertainty piled on five weeks of conflict that was already straining every buffer Delhi has.
Brent crude oil prices have risen to about $116 a barrel from about $103 a barrel on July 1.
Petrol prices on Thursday crossed Rs 73 a litre mark, the highest level since the BJP government came to power in 2014, while diesel touched a record high of Rs 64.11 a litre.
India possesses approximately 100 million barrels of commercial crude oil stocks, capable of covering 40-45 days of its requirements if flows through the Strait of Hormuz are disrupted, according to Kpler.
The fall in international oil prices had resulted in six consecutive reduction in petrol prices since August and two in diesel in the last one month and there was possibility of another round of cuts this weekend.
The government may cut customs duty on petrol and diesel by 5 per cent each to avoid increasing prices that had been necessitated due to a spurt in international oil prices.
The government is considering de-canalising import of petrol and diesel from the next fiscal, a move long awaited by global oil majors like Royal Dutch Shell to begin petro retailing in the country.
Petroleum Minister Ram Naik hinted on Wednesday that prices of petrol and diesel may be cut further at the fortnightly review on Thursday, in tune with the global softening of crude prices.\n\n\n\n
Petrol and diesel prices were on Tuesday hiked by 80 paise a litre while domestic cooking gas prices were increased by Rs 50 per cylinder, ending an over four-and-half month election-related hiatus in rate revision, sources said. Petrol in Delhi will now cost Rs 96.21 per litre as against Rs 95.41 previously while diesel has gone up from Rs 86.67 per litre to Rs 87.47. Simultaneously, the price of a non-subsidised LPG cylinder has been increased to Rs 949.50 for each 14.2-kg bottle in the national capital.
The Indian government has directed oil refineries to increase LPG production to ensure a stable supply of domestic cooking gas, amidst concerns over potential disruptions from the escalating Middle East conflict and its impact on imports.
The government is mulling a Rs 2-3 per litre hike in petrol and diesel prices, as oil firms are losing around Rs 10 per litre on the two fuels due to hardening global prices.
The Rajya Sabha on Monday witnessed uproar over the steep Rs 2.35 a litre hike in petrol price and 50 paisa a litre increase in cost of diesel.
The Cabinet Committee on Economic Affairs may consider slashing customs duty on petrol and diesel from 15 per cent to 10 per cent.
The increases, which follow similar hikes in mid-November, seek to take advantage of a slump in world oil prices to shore up government revenues without stoking inflation.
Indian refiners are negotiating for additional crude cargoes from the US, Russia, and West Africa to ensure adequate supplies amid Middle East tensions. Refineries are maintaining normal processing rates and deferring maintenance to build reserves. The move comes as conflict impacts tanker movements through the Strait of Hormuz, a key energy transit route.
The BJP-led government had raised excise duty nine times between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre.
State-owned exploration firm Oil and Natural Gas Corporation will begin retailing petrol and diesel from its own petrol stations by the year end, company chairman and managing director Subir Raha said on Thursday.
Prime Minister Narendra Modi on Tuesday announced the signing of the India-EU Free Trade Agreement (FTA), saying it accounts for 25 per cent of global GDP and one-third of global trade.
JSW MG Motor India will launch four new models this year, and is planning to invest between 3,000 crore-4,000 crore in the country over the next couple of years. The new models include a plug-in hybrid, an electric vehicle, the Majestor SUV and one additional model yet to be disclosed.
India is the second largest buyer of Iranian crude, after China.
Domestic passenger vehicle dispatches from companies to dealers rose 13 per cent year-on-year to 449,616 units in January with demand remaining robust owing to GST rate rationalisation and subsequent dip in prices, industry body SIAM said on Friday.
Bowing to the demand of state petrol pump operators, Maharashtra Chief Minister Vilasrao Deshmukh on Tuesday agreed to cut state sales tax on petrol and diesel to make auto fuels competitive with neighbouring states.
The price of petrol is expected to come down to Rs 84.71 a litre and diesel to Rs 77.98
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