Petrol and diesel prices cut by Rs 2 each, effective Friday

Petrol and diesel prices were cut by Rs 2 per litre each as stateowned oil companies ended a nearly twoyearlong hiatus in rate revision just hours before the general election schedule is announcedThe revised price will be applicable from 6 am on Friday March 15 the oil ministry said on Thursday eveningPetrol in the national capital will now cost Rs 9472 a litre compared to Rs 9672 per litre currently and diesel will come for Rs 8762 against Rs 8962 at presentThe government had nearly a decade back freed petrol and diesel prices from its control and the rates till now were fixed and announced by oil companiesBut on Thursday the Ministry of Petroleum and Natural Gas took to X to announce the rate revision that came just hours before the schedule for the general elections was due to be announced that would set in motion a poll code which bars making announcements that could lure votersThe price cut came a week after a Rs 100 per cylinder reduction in cooking gas LPG price was announced That reduction brought down the rates of LPG for common users to Rs 803 per 142kg cylinder and that for the poor who got free connections under the Ujjwala scheme to Rs 503 after accounting for Rs 300 per bottle subsidy that the government givesOil Marketing Companies OMCs have informed that they have revised Petrol and Diesel Prices across the country New prices would be effective from 15th March 2024 0600 AM the ministry saidPetrol in Mumbai will cost Rs 10421 a litre from Friday Rs 10394 in Kolkata and Rs 10075 in Chennai A litre of diesel will be priced at Rs 9215 in Mumbai Rs 9076 in Kolkata and Rs 9234 in ChennaiRates differ from state to state depending on the incidence of local taxesLocal sales tax or VAT is the highest among metros in BJPruled Maharashtra and lowest in DelhiReduction in petrol and diesel prices will boost consumer spending and reduce operating costs for over 58 lakh heavy goods vehicles running on diesel 6 crore cars and 27 crore twowheelers the ministry saidReduced petrol and diesel prices will benefit the citizens through more disposable income boost for tourism and travel industries control over inflation increased consumer confidence and spending reduced expenses for businesses dependent on transportation enhanced profitability for logistics manufacturing and retail sectors and reduced outgo for farmers on tractor operations and pump sets it addedInternational oil prices have been turbulent in the last couple of years It dipped into the negative zone at the start of the pandemic in 2020 and swung wildly in 2022 climbing to a 14year high of nearly USD 140 per barrel in March 2022 after Russia invaded Ukraine before sliding on weaker demand from top importer China and worries of an economic contractionBut for a nation that is 85 per cent dependent on imports the spike meant adding to already elevated levels of inflation and derailing the economic recovery from the pandemicSo the three stateowned fuel retailers Indian Oil Corporation IOC Bharat Petroleum Corporation Ltd BPCL and Hindustan Petroleum Corporation Ltd HPCL froze petrol and diesel prices for the longest duration in the last two decadesThey stopped daily price revision in early November 2021 when rates across the country hit an alltime high prompting the government to roll back a part of the excise duty hike it had effected during the pandemic to take advantage of low oil pricesThe freeze continued into 2022 but the RussiaUkraine warled spike in international oil prices prompted a Rs 10 a litre hike in petrol and diesel prices from midMarch 2022 before another round of excise duty cut rolled back all of the Rs 13 a litre and Rs 16 a litre increase in taxes on petrol and diesel done during the pandemicThat followed the current price freeze which began on April 6 2022 and will end with a revision in rates effective FridayThe three firms had till now resisted calls to revert to daily price revision and pass on softening in rates to consumers on grounds that prices continue to be extremely volatile rising on one day and falling on the other and that their past losses have not been fully recoupedThe three companies which control roughly 90 per cent of Indias fuel market voluntarily have not changed petrol diesel and cooking gas LPG prices for almost two years now resulting in losses when input costs were higher and profits when raw material prices were lowerBut the financial numbers of the first three quarters showed them reporting bumper profit totalling over Rs 69000 croreThe combined net profit of IOC BPCL and HPCL in AprilDecember FY24 was better than their annual earning of Rs 39356 crore in preoil crisis year regulatory filings by them showedThey posted a combined net loss of Rs 2120118 crore during AprilSeptember 2022 despite accounting for Rs 22000 crore announced but not paid LPG subsidy for the previous two yearsSubsequent softening of international prices and government giving out LPG subsidies helped IOC and BPCL post annualised profit for 202223 April 2022 to March 2023 but HPCL was in the redThis fiscal year things have changed dramatically The three firms posted record earnings in the first two quarters AprilJune and JulySeptember when international oil prices against which domestic rates are benchmarked almost halved to USD 72 a barrel from a year agoInternational prices rose again in the subsequent quarter to USD 90 leading to a moderation of their earnings They are now hoovering in USD 8283 a barrel rangeThe fuel price freeze that began on April 6 2022 had a loss as high as Rs 174 a litre of petrol and Rs 277 per litre of diesel for the week ended June 24 2022However subsequent softening led to losses being eliminated The three firms had a margin of Rs 11 a litre on petrol and a loss of Rs 23 a litre on dieselThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever