State-owned oil marketing companies (OMC) on Tuesday raised petrol and diesel prices after more than four months of stable rates.Accordingly, the increase in selling price, which includes state levies, central excise and cess amongst other factors, came days after an astronomical rise in crude oil prices due to the Russia-Ukraine war.In New Delhi, the price of petrol and diesel increased by 80 paise per litre.As per pump prices, petrol now costs Rs 87.47 per litre and diesel Rs 96.21 per litre in the national capital.The prices had remained unchanged since November 2021 at Rs 86.67 per litre for diesel and Rs 95.41 per litre for petrol.In the financial capital Mumbai, prices were hiked to Rs 95 per litre for petrol from Rs 94.14 and Rs 110.82 per litre from Rs 109.98.Besides, prices of both the transport fuels were raised in Kolkata. The petrol prices rose to Rs 105.51 and diesel to Rs 90.62 per litre.
In Chennai too, they were increased. Petrol there now costs Rs 102.16 and Rs 92.19 per litre.Till now, fuel prices have been steady since early November when the Centre reduced excise duty on petrol and diesel by Rs 5 and Rs 10 per litre, respectively.The OMCs revise the transportation fuel cost based on various factors such as rupee to US Dollar exchange rate, cost of crude oil and demand of fuel amongst others.Resultantly, the final price includes excise duty, value added tax and dealer's commission.It was widely expected that the OMCs will revise the current prices due to high crude oil cost.Lately, crude oil prices have been volatile surging by nearly 35-40 per cent on fear of tight supplies.Furthermore, it is feared that current sanctions against Russia will curtail more global supplies and stifle growth.
In case of India, the crude oil price range is a cause of concern as it may ultimately add Rs 15-Rs 25 in petrol and diesel selling prices.At present, India imports nearly 85 per cent of its crude oil requirements."On signals that the European Union is coming closer to a ban on Russian crude imports to punish Moscow for its invasion of Ukraine, oil rose for a fourth day, set for its greatest run in a month," said Kshitij Purohit, Lead of Commodities and Currencies CapitalVia Global Research."The oil market will continue to benefit from a lack of supply in the system, and of course, Russia's invasion of Ukraine hasn't helped matters."According to Dilip Parmar, Retail Research Analyst, HDFC Securities: "Currently, Brent crude oil prices are quoting at $119 per barrel rose more than $10 per barrel in two days as Indian basket of $108.25 per barrel on 18 March. Looking at the geopolitical uncertainties' prices of crude oil likely to head higher in coming days."We believe the retail petrol and diesel prices could rise in near term looking at current price movement in crude oil."