In a move to protect the interests of national oil companies against the fluctuations in global crude prices, the government on Monday decided to grant these PSUs limited freedom to fix petrol and diesel prices.
Petroleum Minister Murli Deora and Minister of State for Petroleum Jitin Prasada took charge on Friday.
Finance Minister P Chidambaram and Petroleum Minister Mani Shankar Aiyar may soon meet Prime Minister Manmohan Singh to decide on fuel pricing in the wake of spiraling international oil prices.
Making a case for raising prices of diesel, kerosene and LPG, the Reserve Bank on Tuesday said hike in rates of petroleum products is necessary to arrest fiscal slippages.
Petrol price on Friday inched closer to the Rs 100-a-litre mark in Mumbai while diesel crossed the Rs 91 mark after oil companies raised rates again. Petrol price was increased by 19 paise per litre and diesel by 29 paise a litre, according to a price notification by state-owned fuel retailers. The hike -- 11th this month -- pushed petrol and diesel prices to all-time high levels across the country. In Delhi, petrol rates climbed to Rs 93.04 a litre and diesel rose to Rs 83.80.
The government is likely to decide within the next two days whether to hike petrol and diesel prices to provide some relief to state-run oil marketing companies, Petroleum Minister Murli Deora indicated on Monday.
Petrol price in the national capital neared the Rs 85 a litre mark while diesel rates in Mumbai were close to Rs 82 as fuel prices were raised by 25 paise per litre each on Monday. Petrol now costs a lifetime high of Rs 84.95 per litre in Delhi while diesel comes for Rs 75.13, according to a price notification from oil marketing companies. The price hike on Monday came after three days of unchanged rates. Prices were last hiked by 50 paise a litre in two instalments on January 13 and 14.
With rupee falling to new lows, losses on diesel and cooking fuel have widened to their highest levels this year, upsetting the government's subsidy maths.
Petrol price on Saturday crossed the Rs 100-a-litre mark in Mumbai after the 15th increase in fuel prices this month. Petrol price was increased by 26 paise per litre and diesel by 28 paise a litre, according to a price notification of State-owned fuel retailers.
The BJP on Tuesday announced a nationwide agitation, including a two-hour 'rasta roko'(road blockade) on Wednesday to protest the hike in petrol and diesel prices and the UPA government's "failure to hold the price line".
Petrol price inched towards the Rs 100-mark in Mumbai on Tuesday after fuel rates were hiked again. Petrol price was increased by 23 paise per litre and diesel by 25 paise a litre, according to a price notification of state-owned fuel retailers. The hike - 13th this month - pushed petrol and diesel prices to record-high levels across the country.
The spurt in rates, caused by the rally in international oil prices, has led to the oil ministry asking the finance ministry for a cut in excise duty in the Union Budget 2018-19, to be presented in Parliament next week.
Petrol price on Tuesday crossed Rs 99 a litre mark in Mumbai after oil companies raised petrol and diesel rates on surge in international oil prices. Petrol price was increased by 27 paise per litre and diesel by 29 paise, according to a price notification of state-owned fuel retailers. The hike - tenth this month - pushed petrol and diesel prices to an all-time high across the country. In Delhi, petrol rates climbed to Rs 92.85 a litre and diesel rose to Rs 83.51.
The government on Monday decided to hike petrol price by Rs 4 a litre and diesel by Rs 2 per litre
Car maker Volkswagen India on Monday said it will hike the prices of the diesel variant of its mid-sized sedan Vento by 2.2 per cent from July 1 to offset higher input costs.
The government is unlikely to raise petrol and diesel prices before the end of the current monsoon session of Parliament and may moderate the hike with a dose of excise duty cut, a top official said on Wednesday.
A Group of Ministers is likely to consider this week a marginal hike in petrol and diesel prices and a cut in excise duty on auto fuels to cut the Rs 7,840 crore (Rs 78.40 billion) loss public sector oil firms incur every month.
India, the world's third largest oil consuming and importing nation, in July bought $2.8 billion worth of crude oil from Russia, second only to China which remains the largest importer of Russian oil, a report said. Russia emerged as India's biggest supplier of crude oil, which is converted into fuels like petrol and diesel in refineries, after Russian oil was available on discount following some European nations shunning purchases from Moscow over its invasion of Ukraine in February 2022.
However, truckers have spared other vegetables, fruits, fuel and milk from the strike.
The ministerial panel is now likely to meet on June 24 or 25.
The Left parties on Friday asked Prime Minister Manmohan Singh for a rollback in petroleum prices and said the Budget should conform with the Common Minimum Programme.
Officials from State-run refiners contend that savings from purchase of Russian oil are used to offset a part of the losses in revenues from selling transport fuels and LPG at State-set rates.
Reserve Bank of India (RBI) Governor Shaktikanta Das on Thursday said there is a need for coordinated action between the centre and state governments to reduce taxes on petrol and diesel prices. "There is a need for coordinated action between the centre and states because there are inherent taxes levied by both," the Governor said adding that calibrated reduction of taxes was important. He was speaking at an event organised by Bombay Chamber of Commerce.
Finance Minister P Chidambaram on Friday discussed the issue of petrol and diesel pricing with Prime Minister Manmohan Singh.
Faced with opposition from within the ruling coalition, the government has put-off till at least next week a decision on raising fuel prices that have been necessitated due to crude nearing $100 a barrel globally. The petroleum ministry has planned to take to the Cabinet this week a proposal to either marginally raise petrol and diesel prices or cut duties to offset the impact of raising international oil prices but the proposal is not being pursued this week.
Notwithstanding the robust turnaround in the financial performance for the June quarter (Q1FY24), stocks of state-run oil marketing companies have been in a downtrend in the last month. The fall comes on a rise in crude oil prices that have surged to a 7-month high of $88 a barrel. A busy political calendar in the months ahead that may see the government keep a lid on auto fuel prices is also a dampener, analysts said. Shares of Hindustan Petroleum (HPCL), Bharat Petroleum (BPCL) and Indian Oil (IOC) have shed 9-11 per cent since their respective earnings announcement between July 26 to August 4.
The diesel car becomes too expensive with BS-VI and market assessment says the customer will not buy it at that price, says R C Bhargava, chairman, MSIL. He expects buyer preference to change swiftly in favour of petrol, CNG, and other alternative technologies.
Amid a shift in mobility trends and people increasingly opting for less polluting energy sources, sales of compressed natural gas (CNG) vehicles increased more than 82 per cent in the past five years. A total of 729,902 CNG vehicles were sold in 2022-23 against 400,825 in 2017-18, according to VAHAN Dashboard. Though the increase in sales of CNG-powered vehicles has been significant, their share in overall vehicle sales remains minuscule as is the case with EVs.
'In terms of incentives, if you think about it, hybrids are a 20-year-old technology.'
The entire range of Hyundai's diesel cars - from compact ones to SUV models, including the soon-to-be-launched Aura - will be eco-friendly.
Dominic Xavier offers his take on the Petrol and diesel prices which surged to highest levels in seven years on Tuesday.
State oil firms on Wednesday raised jet fuel (aviation turbine fuel) price by 5 per cent in line with the spike in international oil prices, which have touched a record $71 US a barrel.
Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation are losing Rs 486 crore (Rs 4.86 billion) per day as they are made to sell diesel, domestic LPG and kerosene way below cost to keep inflation under check.
The United Progressive Alliance government on Thursday announced slashing petrol and diesel prices by Rs 2 and Re 1 per litre, respectively, with effect from midnight on Thursday -- as part of measures to tame soaring inflation.
Oil Minister Murli Deora on Wednesday said his ministry is not in favour of raising diesel and domestic LPG prices as response to spurt in global crude oil prices, as the move will add to already high inflation rate.
Diesel makes up nearly half of fuel demand in Asia's No 3 economy.
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