Hike In Petrol and Diesel Price Will Be From Next Week

Several authorized sources stated that India would elevate petrol and diesel rates in the upcoming week as worldwide oil prices rise following Russia’s intervention of Ukraine last week, raising concerns about inflation.

In India, fuel and diesel prices were not lifted in over four months.

Impact of Supply shortages

With London Brent crossing $116 per barrel on Thursday, Oil costs went up sharply since Russia’s invasion of Ukraine on February 24. While supply shortages have impacted global prices of edible items like grains and soyabeans, and metals, including copper, raising concerns about market stability and economic reform.

Why are State-owned companies facing losses?

The authorities has been sought to raise the cost of diesel and petrol by Rs 10-12 per litre, as per the request of state-owned oil companies. In order to assist the BJP in integral state assembly elections, primarily in Uttar Pradesh, State-owned oil and gas producing companies have not inflated the price range in local markets since November. As a result, state-owned fuel distributors (like IOC HPCL) are losing Rs 5.7 per liter on petrol and diesel. This is before their customary margin of Rs 2.5 per litre is factored into account.

A senior government official who is neatly acquainted with internal oil price deliberations has said, “Oil companies would be able to jack up prices gradually in a progressive manner once the election is concluded on March 7”.

The price of petrol and diesel after the slashed import tax and reduced VAT rates by the state government is Rs 96 per liter of petrol and Rs 87 per liter of diesel in the country. Before these tax cuts, the price of petrol had reached the maximum of Rs 110 per litre, while diesel cost Rs 99 per litre in Delhi. A 10% increase in gasoline costs will likely push retail pricing up by 50-60 percent on an average, causing consumers to stifle expenses on apparel and luxuries.