Petrol, diesel prices hiked on sixth consecutive day; more hikes likely

Oil companies on Friday once again hiked the prices of petrol and diesel in the country, making it the sixth consecutive day of upward rate revisions since ending an 83-day period of hiatus.

A litre of petrol became 57 paise more costly while the price of diesel went up by 59 paise per litre. In Delhi, petrol now costs ₹74.57 per litre while diesel rates stand at ₹72.81 per litre.

Prices of the two automotive fuel would vary in different parts of the country due to factors such as local sales tax, VAT etc.

Fuel prices had remained stationery for more nearly three months but began climbing from last Sunday. Since that day, petrol has become dearer by ₹3.31 per litre while diesel has become more costly by ₹3.42 per litre.

A look at how fuel prices have increased from June 6.

Demand has steadily gone up for both petrol and diesel with lockdown restrictions being eased across the country. This prompted Indian Oil to raise refinery output by as much as 80%. "The crude oil throughput of IOC refineries crossed 80 per cent as on date, with consumption of all petroleum products put together almost doubling in May 2020 as compared to April 2020 levels," the company had said in a statement on Wednesday. (Full report here)

Bharat Petroleum had also predicted last month that India's fuel demand would return to pre-Covid-19 levels by July. (Full report here)

The current spate of fuel hikes, however, may only be a start and more such upward revisions may continue. This is speculated to be because when global oil prices fell to record levels in March and April, the lockdown in India had made demand next to nil. With demand now picking up, global oil prices have also rebound and oil marketing companies want to eliminate the gap between cost and sales. This report had highlighted how government sources believe oil marketing companies won't be allowed to hike prices beyond certain outer limit.

For now, however, brace for more upward change in the upcoming days.

(With inputs from agencies)