Petrol and diesel prices are continuously becoming expensive for the commoner with oil marketing companies (OMCs) raising the fuel prices by about 60 paise per litre on Friday.
The auto fuel prices have now risen for the sixth day during a row. With petrol prices increasing by Rs 3.31 and diesel by Rs 3.42 per litre since Sunday.
In three of the last five days, the costs have risen by a point 60 paise per litre while. It increased by around 40 and 55 per litre on Tuesday and Wednesday respectively, and by 57/59 paise on Friday.
Sources in oil marketing companies said that price rise could continue for an additional week and 10 days as global product prices are forming up with a devour in demand following opening from economies across the world post Covid-19 related lockdown.
Even global crude price is on the increase and its prices have quite doubled from April levels at over $40 to a barrel level.
We have made the increase in retail prices on Friday under the dynamic system for a daily revision of fuel price. Which OMCs resumed after over 83 days’ break during the lockdown period.
In the capital, the retail price of petrol increased by 57 paise and diesel by 59 paise per litre to Rs 74.57 and Rs 72.81 per litre respectively.
Petrol and diesel: In other cities, the rise could vary counting on the tax structure on products.
IANS has reported earlier that the daily price revision may begin in June and retail prices of petrol and diesel could go up to Rs 5 a litre in phases.
Prices of transportation fuel were last revised under the dynamic pricing policy on March 16 and there have been few instances of price hike only the respective state governments hiked VAT.
To extend revenues during the nationwide lockdown, several state governments raised taxes imposed on transportation fuel.
Already, the gap between cost and sale price of petrol and diesel for OMCs has reached around Rs 5-6 per litre. If this has got to cover over a period of your time. Given there’s no further increase in global prices. Auto fuel prices could also be increased by 40-60 paise per day for a few of weeks to hide the losses.
The increase in retail price under daily price revision would largely depend upon prevailing oil prices and global oil market at the time to work out the retail price.
However, lockdown has also curved demand for auto fuel. This might maintain some check on prices.
Raising retail prices became important for OMCs now because the recent steep excise duty hike. Without a resultant increase in petrol and monetary prices. Had substantially brought down its marketing margins from a record top level of Rs 12-18 per litre.
If it’s unable to boost prices when the worldwide crude prices are rising. It might start incurring losses which will get steeper.