NE BUSINESS BUREAU
NEW DELHI, MAY 5
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 increased 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.
Rates have been increased across the country and vary from state to state depending on the local incidence of taxation (VAT).
Oil companies had on Tuesday resumed daily price revision in line with cost after ending an 18-day hiatus. Prices were on Tuesday hiked by 15 paise per litre for petrol and 18 paise on diesel.
In two days, more than half of the 67 paise a litre reduction in petrol and 74 paise per litre cut in diesel prices effected between March 24 and April 15, has been wiped out.
Oil companies, who have in recent months resorted to unexplained freeze in rate revision, had hit a pause button after cutting prices marginally on April 15. This coincided with electioneering hitting peak to elect new governments in five states including West Bengal.
No sooner had voting ended, oil companies indicated an impending increase in retail prices in view of firming trend in international oil markets.
Despite the concerns about rising COVID-19 cases in India denting demand, crude oil prices in the international market have risen primarily on account of strong US demand recovery and a weak dollar.
Prices have been on a continuous uptrend since April 27, an industry official said adding crude oil price hit USD 65 per barrel mark.
It is expected that the crude oil prices in the international market will remain firm in the near future, exerting upward pressure, he said.
State-owned fuel retailers, IOC, BPCL and HPCL, who are supposed to revise rates daily based on input cost, had raised petrol price by Rs 21.58 per litre and diesel by Rs 19.18 a litre since the government raised excise duty in March last year.
Central and state taxes make up for 60 per cent of the retail selling price of petrol and over 54 per cent of diesel. The union government levies Rs 32.90 per litre of excise duty on petrol and Rs 31.80 on diesel.
In Mumbai, the petrol price was hiked to Rs 97.12 a litre on Wednesday from Rs 96.95, while diesel rates were increased to Rs 88.19 from Rs 87.981, the price notification showed.
