A hike in the prices of petrol and diesel is unlikely before June 15 as the Congress-led government does not want a showdown with its allies in the first session of Parliament beginning June 2.
The hike, effective Monday midnight, excludes local sales tax or VAT and the actual increase will be higher, varying from city to city.
The petroleum ministry on Friday reaffirmed the government's commitment to maintaining stable petrol and diesel prices, despite India's high dependence on imports.
India's wholesale price inflation surged to 8.30 per cent in April, up from 3.88 per cent in March, primarily driven by a significant increase in the prices of fuel, power, and crude petroleum, according to data from the commerce and industry ministry.
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.
In 16 days, petrol price has been hiked by Rs 8.3 per litre and diesel by Rs 9.46 - a record increase in rates of the fuel in any fortnight since pricing was deregulated in April 2002.
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.
Senior Trinamool Congress leader Abhishek Banerjee has accused the BJP-led central government of planning to increase fuel prices after the West Bengal assembly elections. He challenged the BJP to promise no price hikes for LPG, petrol, and diesel over the next five years.
The Union Cabinet will take a decision on pricing petroleum products when it meets on Tuesday, Finance Minister P Chidambaram said on Monday.
Indian Oil Corporation, the nation's largest fuel retailer, is likely to hike petrol prices by Rs 0.33 per litre from Tuesday. IOC Chairman B M Bansal said international crude oil prices have risen since the last price revision, necessitating an increase in domestic retail prices.
The proposal was under consideration of the Cabinet, Sarthak Behuria, chairman, Indian Oil Corporation, told reporters in Chennai after presiding over a memorandum of collaboration event.
Petrol prices will not be raised this fortnight as state-owned oil firms apparently could not get political clearance for the over Rs 2 per litre hike in rates needed to achieve parity with the imported cost on account of the weakening rupee.
Petrol price on Monday neared Rs 100-a-litre mark in the national capital after the rate was hiked yet again. Petrol price was increased by 35 paise per litre while there was no change in diesel rates, according to a price notification from state-owned fuel retailers. In Delhi, the petrol price soared to Rs 99.86 per litre. Diesel rates were unchanged at Rs 89.36.
With this increase, diesel prices have touched a record high while petrol is at a 56-month peak.
Petrol and diesel prices were hiked by 60 paisa per litre on Monday, for the second day in a row, as State-owned oil firms reverted to daily price revisions after an 83-day hiatus. Petrol price in Delhi was hiked to Rs 72.46 per litre from Rs 71.86 on Sunday, while diesel rates were increased to Rs 70.59 a litre from Rs 69.99, according to a price notification of state oil marketing companies.
International oil prices surged close to $100 a barrel on Tuesday after Russian President Vladimir Putin sent troops into Ukraine, but petrol and diesel prices in India continue to be on freeze and are expected to rise once assembly elections in states like Uttar Pradesh end. Amid fears of supplies being disrupted because of Russian aggression, the price of futures contract for Brent crude oil with April delivery on London's ICE rose by 4.18 per cent to $99.38 per barrel on Tuesday morning, before paring some gains to settle just above $98. The last time Brent exceeded $99 per barrel was in September 2014. Russia makes up for a third of Europe's natural gas and about 10 per cent of global oil production.
The Trinamool Congress has launched a sharp attack on the Narendra Modi government over rising fuel prices, economic concerns, and exam irregularities, accusing the Centre of betraying citizens.
Petrol price was on Wednesday hiked by a steep Rs 3.38 per litre and diesel by Rs 2.67 a litre, reversing a two-month declining trend.
Prime Minister Manmohan Singh on Tuesday said that diesel prices too will be freed from government control as part of 'much-needed reforms', but LPG and kerosene will continue to be subsidised.
A foreign brokerage warns that sustained crude oil prices above USD 100 per barrel could push India's inflation above the RBI's tolerance level, potentially triggering interest rate hikes.
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.
The government may marginally increase petroleum prices, petroleum secretary M S Srinivasan on Tuesday said.
Hours after the United Progressive Alliance government increased petrol and diesel prices today, the Left parties announced nationwide demonstrations against the hike, which are likely to be held on June 28.
The retail selling price of petrol at Delhi would come down by Rs 1.82 a litre.
The price of jet fuel (ATF) was sharply increased by 7.5 per cent on Tuesday, while the cost of LPG used in commercial establishments was reduced by Rs 58.50 per cylinder, reflecting shifts in international benchmark rates. After three rounds of price cuts, aviation turbine fuel (ATF) price was increased by Rs 6,271.5 per kilolitre, or 7.5 per cent, to Rs 89,344.05 per kl in the national capital - home to one of the busiest airports in the country, according to state-owned fuel retailers.
The All Assam Students Union on Friday burnt the effigy of Union Petroleum Minister Jaipal Reddy in protest against hike in petroleum price and termed the decision of the public sector oil companies to increase the petroleum price grossly anti-people.
Diesel price hike is a tough decision and we need lot of tough decisions to get to 8 per cent growth rate," Planning Commission Deputy Chairman Montek Singh told reporters.
Aviation Turbine Fuel (ATF) prices have more than doubled to a record high, impacting airlines and consumers, while commercial LPG rates also see a significant increase.
India has no plans to ration fuel supplies despite ongoing disruptions in global energy markets, according to a top oil ministry official. The country has maintained adequate inventories of crude products and LPG while diversifying imports to manage supply risks.
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 Indian government has increased the export duty, or windfall tax, on diesel to Rs 55.5 per litre and on aviation fuel (ATF) to Rs 42 a litre, effective immediately, to boost domestic availability and prevent exporters from exploiting global price differences.
The Bharatiya Janata Party on Tuesday announced country wide protest programme for two days beginning Wednesday against the hike in the prices of petroleum products.
Petrol price on Wednesday neared all-time high after state-owned fuel retailers hiked rates after a nearly month-long hiatus. Petrol price was raised by 26 paise per litre and diesel by 25 paise a litre, according to a price notification from oil marketing companies. After this increase, petrol in Delhi climbed to Rs 83.97 per litre from Rs 83.71 previously. Diesel rates rose to Rs 74.12 per litre from Rs 73.87. In Mumbai, diesel touched an all-time high of Rs 80.78.
The decision to hike petrol and diesel prices cannot be deferred for a very long time, Union Finance Minister P Chidambaram said on Tuesday.
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.
Diesel rates were cut by 40 paisa to Rs 68.89 a litre. With this, the reduction in rates in last six weeks totals Rs 9.26 per litre on petrol and Rs 7.2 per litre on diesel.
Trinamool Congress leader Abhishek Banerjee alleges the BJP-led government may increase fuel prices after the West Bengal assembly elections, accusing them of neglecting the common man and withholding funds from the state.
The hike in petrol price was necessitated because of increase in prices of crude oil in the international market, Union Finance Minister Pranab Mukherjee said.
Petrol, diesel prices hiked by 40 paise
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