Petrol-Diesel / Petrol now costs over ₹100 per litre in all 4 metro cities in India

Zoom News : Jul 07, 2021, 04:39 PM
New Delhi: Auto fuel prices were increased again on Wednesday (July 7) taking petrol price in Delhi and Kolkata over Rs 100 per litre for the first time. Petrol price rose up to 39 paise while the price of diesel went up approximately 21 paise across metros, according to Indian Oil Corporation (IOC) data. It is important to note that a sharp jump in Brent crude prices touching a high of over $74 a barrel propelled retail prices in India to new highs.

After today’s hike, petrol prices were increased by 35 paise and diesel by 17, respectively in Delhi. At present, petrol and diesel are priced at Rs 100.21 a litre and Rs 89.53 a litre, respectively. Starting from a price line of Rs 90.40 a litre on May 1, petrol rose by a steep Rs 9.81 per litre in the last 68 days in the national capital. Likewise, diesel prices in the capital also hiked by Rs 8.80 a litre in the past two months. The increase on Wednesday is the 36th hike in prices since May 4, when state-controlled oil marketing companies (OMCs) ended an 18-day freeze in rate revision they observed during West Bengal assembly elections.

Rates in top cities

In Mumbai, petrol prices hit an all-time high of Rs 106.25  a litre, with a hike of 33 paise. Motorists in the financial capital of India have to pay Rs 97.09 for a litre of diesel after an 18 paise hike over yesterday’s rate. On May 29, the retail price of petrol had crossed the century mark in Mumbai.

Citizens in Kolkata have to shell out Rs 100.23 for a litre of petrol after a 39 paise hike over Tuesday’s rate. A litre of diesel costs Rs 92.50, 21 paise more than yesterday’s price of Rs 92.27 a litre. In Chennai, the pump price of petrol price surged by 31 paise to Rs 101.06 a litre, from Rs 100.75 recorded on Tuesday. Diesel costs Rs 94.06 a litre, 15 paise extra than yesterday’s rate.

Taxes on auto fuels

As per the dynamic pricing mechanism, OMCs revise the pump prices of transportation fuels on a daily basis. Plus, prices of petrol and diesel are dependent on Brent crude oil rates as India imports around 82 per cent of its fuel requirements.

The pump price of petrol and diesel vary from state to state depending on the incidence of local taxes such as VAT (value-added tax) and freight charges. Central and state taxes make up for over 61 per cent of the retail price of petrol and about 56 per cent of diesel. The Union government levies Rs 32.9 per litre of excise duty on petrol and Rs 31.80 a litre on diesel.

Many experts believe that a constant surge in fuel prices is likely to fan inflation and it will make it difficult for the Reserve Bank of India (RBI) to persist with its accommodative approach to assist growth to push its growth, and the government should take some steps of its own to control price rise, including meaningful cuts in fuel taxes. Reeling from income losses and higher medical costs since the Covid-19 pandemic’s onset, the persistently high inflation is a huge blow to India's middle-income group—the middle class.

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