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.
India's retail inflation, measured by the Consumer Price Index (CPI), increased to 3.48 per cent in April, up from 3.40 per cent in March, primarily due to a surge in prices of gold and silver jewellery, as well as certain kitchen staples like tomatoes and cauliflower.
The petroleum ministry has proposed a Rs 3.25 per litre hike in petrol and about Rs 4 per litre increase in diesel prices in line with the spurt in global crude oil prices that have touched $66 a barrel.
The expert group was tasked to suggest a methodology for pricing of diesel and cooking fuel.
Sri Lankan President Anura Kumara Dissanayake has announced an economic relief package to mitigate the impact of the West Asia conflict, including fuel price reductions and support from India for petrol and diesel supplies.
Households should moderate large discretionary expenses for the time being.
'They should prioritise essential spending. They should maintain an emergency fund covering 6 to 12 months of expenses.'
In one of the steepest increases since daily price revision was started, petrol price on Thursday was hiked by 25 paise per litre and diesel by 30 paise as oil companies raised rates for the third straight day to pass on to consumers the increase in international oil prices.
Petrol and diesel prices were raised for the second day in a row on Wednesday as state-owned fuel retailers resumed daily rate revision after a more than two-week long hiatus during assembly elections in states like West Bengal. Petrol price was increase ford by 19 paise per litre and diesel by 21 paise a litre, according to a price notification of state-owned fuel retailers. Petrol in the national capital now costs Rs 90.74 a litre and diesel comes for Rs 81.12 per litre.
The Indian government has increased import duties on gold and silver from 6 per cent to 15 per cent to curb inbound shipments of precious metals amid a rising import bill due to the West Asia crisis.
"We had announced last year that the decision would be taken at an appropriate time to deregulate diesel, the government hasn't changed their decision... We have to see how the inflationary pressures go and take a decision," Revenue Secretary Sunil Mitra told reporters on the sidelines of an Assocham function.
Left parties on Monday opposed any increase in petrol and diesel prices in step with the hike in global oil prices and higher taxes, and asked the government to restructure duties to protect the consumers.
'I have no problems with the finance ministry or with state governments treating petrol pump prices as the last resort for meeting their ambitious spending targets with very limited revenue resources.' 'But let's do away with this smokescreen of free pricing of petrol and diesel and go back to administered pricing regime,' says Dr Sudhir Bisht.
'Every year we import approximately $70 billion worth of gold -- closer to $72 billion in 2025-2026, an all-time record.' 'There is no parallel for this anywhere in the world. And this love for gold will not disappear overnight.'
The government on Thursday decided not to increase petrol and diesel prices, and issue oil bonds worth Rs 23,457 crore (Rs 234.57 billion) to partly compensate public sector oil companies for the losses incurred on fuel sales."We have kept our promise of not raising prices of sensitive petroleum products," Petroleum Minister Murli Deora told PTI after a meeting of the Cabinet.
The Confederation of Indian Industry (CII) has urged the Indian government to gradually restore the Rs 10-per-litre cut in special additional excise duty on petrol and diesel over six to nine months. This move aims to relieve pressure on government finances as crude oil prices stabilise, without significantly impacting consumer sentiment.
Congress leader Rahul Gandhi has warned of a severe economic crisis looming over India, criticising Prime Minister Narendra Modi's economic policies and foreign travels.
Petrol, diesel prices hiked by Re 1/ litre
With food inflation ruling at uncomfortable level, Petroleum Minister S Jaipal Reddy on Thursday ruled out freeing of diesel prices from government control, saying the move was not politically and practically feasible.
Indian stock markets experienced a significant sell-off, with the Sensex tumbling over 1,300 points, driven by escalating crude oil prices due to US-Iran tensions and Prime Minister Narendra Modi's call for austerity measures, which amplified investor concerns about India's economic outlook.
This is the time for India to plan forward fully, with the goal of Atmanirbharata, and energy security. The Persian Gulf is no longer a reliable source, points out Rajeev Srinivasan.
Since end-May there has been volatility in the foreign exchange market.
The campaign for elections to 51 urban local bodies, including four municipal corporations in Himachal Pradesh, concluded on Friday, with key issues including infrastructure, tourism, and fuel prices taking centre stage.
Narendra Modi's landslide victory gives him the mandate to deregulate diesel prices as well as raise natural gas rates with a clear road map towards free pricing to cut subsidies and shrink the budget deficit.
Uttam Ghosh offers his take on the daily increase in the prices of petrol and diesel.
Diesel price needs to be revised upward, or subjected to higher taxes, as misuse of subsidized diesel was adding to pollution and public health costs, the government's pre-budget economic report card said on Thursday.
Petrol and diesel price hikes are likely to resume after state elections get over next week to bridge the Rs 9 a litre gap created by international oil prices soaring past $100 a barrel. International crude oil prices shot above $110 a barrel for the first time since mid-2014 on fears that oil and gas supplies from energy giant Russia could be disrupted, either by the conflict in Ukraine or retaliatory western sanctions. The basket of crude oil India buys rose above $102 per barrel on March 1, the highest since August 2014, according to information from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry.
The basket of crude oil that India buys has hit a decade high of $121 per barrel, but retail selling prices of petrol and diesel continue to remain frozen. The Indian basket on June 9 touched $121.28, matching levels seen in February/March 2012, according to data available from the oil ministry's Petroleum Planning and Analysis Cell (PPAC). As per the PPAC, the Indian basket of crude oil averaged $111.86 per barrel between February 25 and March 29 - the immediate period after Russia's invasion of Ukraine sent oil on fire.
Faced with huge under-recoveries, Indian Oil Corporation on Saturday sought an immediate upward revision of petrol and diesel prices to the the extent of Rs 10.50 paise per litre.
'In all these years of rupee depreciation, of rising oil prices, of inflation caused by import dependence, not one leader had the courage to look the people in the eye and say: Please do this for your country.'
India emerged reasonably well from 2025. But now, the oil shock and war-related supply disruptions have again driven funds out of India and significantly weakened the rupee, points out Ajay Chhibber.
The proposed move would lead to dismantling of the administered price mechanism.
"There is no immediate plan to decontrol diesel or LPG as they have cascading effect (on general prices)," Minister of State for Petroleum and Natural Gas R P N Singh told reporters in New Delhi.
Petrol would cost Rs 33.49 per litre in Delhi while diesel Rs 22.12 per litre.
Holding her party would oppose any 'attempt to sell out the country', she claimed that in the past five months, the Centre had done nothing 'good' and that 'Bharatiya Janata Party is only busy beating its own drum in the social media'.
Analysts predict India will face oil price volatility and macroeconomic effects due to the escalating Iran crisis, though the country's oil supply chain is not yet structurally insecure.
A senior government official asserts India's independence in purchasing Russian oil, stating that US sanctions waivers merely remove friction but do not dictate India's energy policy. The official highlights India's commitment to energy security and affordability for its citizens.
'Even last year, when India bought gold, the physical quantity was much less than the previous years.'
The excise duty cut will translate into a reduction of Rs 9.5 a litre on petrol and Rs 7 a litre in diesel after taking into account its impact on other levies.
The Bharatiya Janata Party on Thursday described Samajwadi Party's opposition to the hike in diesel price as a "drama" and demanded that the government reduce value added tax (VAT) in Uttar Pradesh if it was really concerned about the people.
"The recent increase in diesel prices is an important step in the right direction," he said while addressing the meeting of the Full Planning Commission which was called to approve the 12th Five Year Plan document.
