Petrol Diesel Price Hike: Crude Oil Surges 51 Percent In 78 Days

The domestic fuel market in India has witnessed a significant shift as petrol and diesel prices were hiked by 3 rupees per liter on May 15. This price revision is particularly noteworthy as it represents the first increase in fuel rates since April 2022. The primary drivers behind this decision by oil marketing companies are the relentless surge in international crude oil prices and the consistent decline of the Indian rupee against the US dollar. The ongoing conflict involving Iran has played a pivotal role in destabilizing the global energy market, leading to a sharp rise in crude costs over the last 78 days.

Impact of the Iran War on Global Crude Prices

Since the commencement of the Iran war, the international market has seen crude oil prices jump by 51 percent. This rapid escalation has pushed crude prices well above the 100 dollars per barrel mark, creating a challenging situation for major oil-importing nations like India. The data reveals a stark contrast in prices over a short period, while on February 27, the price of crude oil from Gulf countries stood at 72 dollars 48 cents per barrel in the international market. Since then, Brent crude has surged by approximately 51 percent, reaching a current level of 109 dollars 26 cents per barrel. Similarly, the American crude, WTI, has seen an even steeper increase of over 57 percent. On February 27, WTI was trading at 67 dollars 2 cents per barrel, but it has now climbed to 105 dollars 42 cents per barrel.

Current Petrol and Diesel Rates Across Major Cities

Following the price hike on May 15, fuel rates have remained stable for the second consecutive day. According to the latest data from Indian Oil Corporation Limited (IOCL), the prices in the national capital and other metropolitan cities are as follows, while in Delhi, petrol is being sold at 97 rupees 77 paise per liter, while diesel is priced at 90 rupees 67 paise per liter. In the city of Kolkata, petrol has reached 108 rupees 74 paise per liter, and diesel is available at 95 rupees 13 paise per liter. Mumbai continues to have some of the highest rates, with petrol at 106 rupees 68 paise per liter and diesel at 93 rupees 14 paise per liter. In Chennai, the price of petrol stands at 103 rupees 67 paise per liter, and diesel is priced at 95 rupees 25 paise per liter.

The Double Blow: Rupee Depreciation and Rising Costs

India is currently facing a double blow to its economy and national exchequer. While crude oil prices remain high, the Indian rupee has also weakened Notably against the US dollar, while during the period of the Iran war, the rupee has seen a decline of more than 5 percent. On February 27, the rupee was at a level of 91 rupees 8 paise against the dollar. Since then, it has depreciated by 5 point 19 percent. By the close of trade on May 15, the rupee stood at 95 rupees 81 paise against the dollar. This means the rupee has lost 4 rupees 73 paise against the dollar during the conflict period. In this week's trading sessions alone, the rupee suffered a loss of 230 paise. Experts suggest that if these international conditions persist, further hikes in fuel prices could be expected in the coming days.