In 12 hikes, petrol price has gone up by Rs 6.55 per litre and diesel by Rs 7.04 a litre.
With Indian Oil, Hindustan Petroleum and Bharat Petroleum projected to lose Rs 200,000 crore (Rs 2,000 billion) in revenues on sale of petrol, diesel, domestic LPG and kerosene below import cost, industry sources said a hike in the range of Rs 2 to 5 per litre appears on the cards.
Oil firms were supposed to break-even on sale of petrol, diesel, LPG and kerosene if the price of the basket of crude India buys were to come down to $67 per barrel. However, with 20 per cent depreciation in value of rupee against the dollar, the break-even point is now at $61 a barrel.
These refineries, commissioned mostly in the 1950s and 1960s during India's early industrialisation push, are inefficient and costly to maintain compared to their modern counterparts on the coast mainly operated by private companies.
Petroleum Minister Ram Naik on Monday said the hike in petrol and diesel prices was "justified" given the hardening of global crude prices.
Amid record-high fuel prices, Finance Minister Nirmala Sitharaman on Monday said there is no proposal as of now to bring crude oil, petrol, diesel, jet fuel (ATF) and natural gas under the Goods and Services Tax (GST). When the GST was introduced on July 1, 2017, amalgamating over a dozen central and state levies, five commodities - crude oil, natural gas, petrol, diesel, and aviation turbine fuel (ATF) - were kept out of its purview given the revenue dependence of the central and state governments on this sector. This meant that the central government continued to levy excise duty on them while state governments charged VAT. These taxes, with excise duty, in particular, have been raised periodically.
Petrol price cut by Rs 1.46, diesel by Rs 1.53 per litre
The government on Tuesday ruled out any immediate cut in petrol and diesel prices in line with fall in global oil prices, but said a reduction may be considered once crude prices fall below $50 a barrel.
The government is considering a 3-rupee to 5-rupee hike in the price of diesel, which accounts for more than 40 percent of fuel use, government officials said last week, as the country looks to cut import costs by nearly $20 billion to trim a record current account deficit.
The government does not seem inclined, at least in the petroleum sector, to effect sudden and steep upward price revisions to tame its huge subsidy burden and rein in fiscal deficit.
Empowered group of ministers on fuel pricing was likely to meet soon.
Concerned over surging prices, Finance Minister P Chidambaram said on Friday the government will not hesitate to take more fiscal and monetary measures to contain inflation.
Oil firms' borrowings could fall by up to Rs 15,000 cr, govt's subsidy bill by 12% .
Diesel, which is sold at Rs 53.67 a litre in Delhi, will cost Rs 53.77 after the hike in commission.
He did not announce any rollback on diesel price hike.
As auto major Mahindra & Mahindra (M&M) became the number two player in the retail passenger vehicle segment for the first time in February, powered by its new launches, the company is setting its sights on technology upgrades.
Congress president Mallikarjun Kharge has accused the BJP of rigging the Maharashtra assembly elections and called for a return to ballot paper voting. He also criticized the Modi government for selling off public assets, undermining democratic institutions, and promoting communal polarization. Kharge's remarks come as the Congress prepares for its AICC session in Ahmedabad, where it will present its political and economic views.
The ministry is preparing a draft note for consideration of the CCPA on pricing of diesel, kerosene and LPG, official sources said.
Much before the honeymoon ended with the public, the Manmohan Singh government delivered a shock in the form of the fuel price hike -- an act of confident UPA -- to compensate the losses of 2010 Union budget.
Petrol and diesel will cost Rs 2 a litre less from Wednesday after the first excise duty cut by the Modi government comes into effect.
Prime Minister Manmohan Singh ruled out any rollback in hike in petrol and diesel prices, saying the economy has the capacity to absorb the increase without triggering an inflationary spiral. Singh also made it clear that following populist fiscal policies for long harmed the economy, two days after key United Pogressive Alliance allies Trinamool Congress and Dravida Munnetra Kazhagam made a strong pitch for the rollback.
India's trade account could come under pressure and there could be an inflation push if crude oil prices remain above the $90 per barrel (Brent) for a prolonged period since India imports over 85 per cent of its oil and roughly 50 per cent of its gas. A rebound in economic activity is bound to lead to higher fuel demand. While India is the third-largest importer of crude, it is a net exporter of refined products, which helps to compensate to some degree.
Essar Oil has decided to cut petrol and diesel prices in the range 50 paise to Rs 2.50 per litre effective from July 16.
