New Delhi: Petrol and diesel price was on Sunday hiked by 60 paise per litre, as the state-owned oil firms restarted daily price revisions after an 82-day.
Petrol price in Delhi was hiked to Rs 71.86 per litre from Rs 71.26 a litre till Saturday, while diesel rates were increased to Rs 69.99 per litre from Rs 69.39, according to a price notification of state oil marketing companies.
While oil PSUs have regularly revised ATF and LPG prices, they had since March 16 kept petrol and diesel prices on hold, ostensibly on account of extreme volatility in the international oil markets.
Auto fuel prices were frozen soon after the government raised excise duty on petrol and diesel by Rs 3 per litre each to mop up gains arising from falling international rates.
The government on May 6 again raised excise duties by Rs 10 per litre on petrol and Rs 13 per litre on diesel.
Oil companies, instead of passing on the excise hike to consumers, decided to adjust them against the reduction required because of the drop in international oil prices. They used the same tool and did not pass on the Re 1 per litre hike required for switching over to ultra-clean BS-VI grade fuel from April 1.
Petrol price in Mumbai and Kolkata was hiked by 59 paisa each to Rs 78.91 and Rs 73.89 per litre, respectively. In Chennai, the hike was 53 paisa to Rs 76.07, according to the price notification.
For diesel, price was hiked by 58 paisa in Mumbai to Rs 68.79 and in Kolkata by 55 paisa to Rs 66.17. In Chennai, the price was hiked from Rs 68.22 to Rs 68.74.
While petrol and diesel prices had been kept on hold for nearly three months, they are regularly revised for ATF and LPG despite the fact that the same volatility was witnessed in their prices as well.
More importantly, no airline operated between mid-March to May 25 in view of the restrictions placed to check the spread of coronavirus, yet oil companies have continued to revise downward jet fuel prices.
In fact, oil companies used to revise ATF prices on the 1st of every month, but adopted fortnightly revisions on March 21 to pass on the benefit of falling international oil prices to airlines.
Though the government has deregulated petrol and diesel prices, rate changes have been in the past put on hold by public sector oil companies — Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) — for reasons that appear to be non-commercial.
There was a 19-day price freeze on petrol and diesel ahead of Karnataka polls in May 2018, despite international fuel prices going up by nearly USD 5 per barrel. However, no sooner were the elections over, they rapidly passed on to customers the desired increase — over 16-straight days post-May 14, 2018, petrol price climbed by Rs 3.8 per litre and diesel by Rs 3.38 per litre.