Working on a positive note, oil companies in India have decided to cut the petrol prices by Rs.2 per litre without the state taxes. So from now on, the petrol in the Delhi NCR region will now cost about Rs. 2.40 less than previous price. This is the highest reduction in the petrol prices in the last nine months. And against all the news about the diesel price rise, to the satisfaction of many companies have confirmed to keep it currently on hold. However, this move is also being seen as the government initiative to escape from the criticism it is facing from all sides because of the decision of the partial deregulation of the diesel prices.
The reduction is first time in the three months and mainly can be attributed to the fall in the global prices of the crude oil and stronger rupee condition. The oil companies are currently witnessing about Rs. 11 per litre loss on the diesel. After the deregulation of the diesel prices from the government Oil companies are not allowed to increase the diesel prices until they recover their current loss on the diesel but at the same time government have also restrained the companies from increasing the prices more than 50 paise per month. Oil companies have currently decided not to increase the diesel prices but the scenario can’t be same for much long. With the huge loss on the diesel companies will be forced to hike the price of the diesel.
Looking at the petrol price reduction it is now quite a relief for the customers. Previously petrol has seen two consecutive price hikes earlier this year, the first one came in February when it was raised by Rs. 1.50 per litre and then again petro prices were raised in the March 2013 by Rs. 1.40 per litre. Petrol as fuel is currently a decontrolled commodity and its prices are determined by the oil marketing companies in regards with the market rates and other factors. Diesel too is partially decontrolled; oil companies have got the right to increase the price of the diesel marginally on monthly basis. The price of the diesel can be increased by about 50 paise per litre on monthly basis.