The price reduction has wiped off the entire price hike on petrol and diesel in two months beginning August 16.
After clocking a massive hike in last six-weeks, petrol price on Wednesday fell below ₹ 74 per litre mark for the first time since April. Petrol price in Delhi was cut by 50 paisa to ₹ 73.57 per litre, according to a price notification issued by state-owned fuel retailers. Diesel rates were cut by 40 paisa to ₹ 68.89 per litre. With this, the reduction in rates in last six weeks total to ₹ 9.26 per litre on petrol and ₹ 7.2 per litre on diesel. Rates have been on the decline since October 18. This has wiped off the entire price hike on petrol and diesel in two months beginning August 16.
Petrol price had touched a record high of ₹ 84.00 per litre in Delhi and ₹ 91.34 in Mumbai on October 4. Diesel on that day had peaked to an all-time high of ₹ 75.45 a litre in Delhi and ₹ 80.10 in Mumbai. Prices had started to climb from August 16. Petrol in Delhi was priced at ₹ 77.14 per litre and in Mumbai it cost ₹ 84.58 on August 15. Diesel on that day was priced at ₹ 68.72 per litre in Delhi and at ₹ 72.96 in Mumbai. Petrol price in Mumbai Wednesday stood at ₹ 79.12 per litre and diesel was priced at ₹ 71.71. Between August 16 and October 4, petrol price was hiked by ₹ 6.86 per litre and diesel by ₹ 6.73 per litre.
On October 4, the government decided to cut excise duty on petrol and diesel by ₹ 1.50 per litre each and asked state-owned fuel retailers to subsidise prices by another ₹ 1 per litre by reducing their margins. Many states including Maharashtra matched that with a reduction in local sales tax or VAT. Subsequent to this, the petrol price came down to ₹ 81.50 per litre in Delhi and diesel to Rs 72.95 a litre on October 5. In Mumbai rates fell to ₹ 86.97 per litre for petrol and ₹ 77.45 for diesel.
As the international oil prices continued to rise, price of petrol and diesel in Delhi increased to ₹ 82.83 and ₹ 75.69 on October 17. In Mumbai, rates touched ₹ 88.29 per litre for petrol and ₹ 79.35 per litre for diesel. But since then, international oil prices have been falling and rupee has also appreciated, resulting in decline in retail rates. With international oil prices declining to USD 60 per barrel, retail prices of petrol and diesel may reign easy in the next few days.
The retail selling price of petrol and diesel is dependent on the international prices of crude oil and the rupee-US dollar exchange rate.
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