Fifth hike since May 4 makes diesel costlier by 33 paise a litre, driving fuel prices to record highs
Petrol and diesel prices surged across the country after rates were increased for the fifth time in a week on Monday, with Maharashtra joining Rajasthan and Madhya Pradesh in the brigade of states where petrol prices surpassed the Rs 100-a-litre mark.
According to a price notification by state-owned fuel retailers, the price of petrol has increased by 26 paise per litre and the price of diesel has increased by 33 paise per litre. This was the fifth increase in prices since May 4, when the state-owned oil firms ended an 18-hiatus in rate revision during assembly elections in states like West Bengal.The rise sent petrol and diesel prices to their all-time highs.
Though petrol prices in some parts of Rajasthan and Madhya Pradesh had recently surpassed Rs 100, Maharashtra's Parbhani entered the league on Monday. Petrol was priced at Rs 100.20 per litre in Parbhani and Rs 99.55 per litre in Bhopal. The fuel costs Rs 102.42 per litre in Rajasthan's Sri Ganganagar district and Rs 102.12 in Madhya Pradesh's Anuppur. This is the second time this year that prices in some parts of the country have surpassed Rs 100 per litre. In mid-February, rates had surpassed the physiological threshold for the first time.
The impact of local taxes such as VAT and freight charges on fuel prices varies from state to state. Rajasthan, followed by Madhya Pradesh, has the highest value-added tax (VAT) on petrol in the world. Petrol prices have risen by Rs 1.14 per litre and diesel prices have risen by Rs 1.33 in the last week, more than cancelling out the reductions that occurred between March 24 and April 15.
After raising petrol price by a record Rs 21.58 per litre and diesel by Rs 19.18 since the government raised excise duty to an all-time high in March last year, state-owned fuel retailers, IOC, BPCL and HPCL had reduced petrol price by 67 paise a litre and diesel by 74 paise per litre effected between March 24 and April 15. Oil companies, which have in recent months resorted to an unexplained freeze in rate revision, had hit a pause button after cutting prices marginally on April 15. This coincided with electioneering hitting a peak to elect new governments in five states, including West Bengal.
More oil firms announced an imminent rise in retail prices as soon as the vote was completed, citing firming patterns in foreign oil markets. According to them, prices have been on an upward trajectory since April 27 and are currently hovering around the $70-per-barrel level.
Central and state taxes make up for 60 per cent of the retail selling price of petrol and over 54 per cent of diesel. The union government levies Rs 32.90 per litre of excise duty on petrol and Rs 31.80 on diesel. In Mumbai, the petrol price was hiked to Rs 97.86 a litre on Monday from Rs 97.61, while diesel rates were increased to Rs 89.17 from Rs 88.82, the price notification showed.