Petrol, diesel prices ready for century as OPEC+ extends production cut
After registering regular hikes in February, petrol and diesel prices remain unchanged across the four metro cities in India for the sixth consecutive day on Friday. Petrol and diesel prices were last hiked on Saturday by the oil marketing companies. Since then, fuel rates have remained steady across all four metro cities.
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However, as it seems the price of petrol and diesel are about to shoot higher as OPEC+ has decided to extend the production cut. On Thursday, OPEC+ announced its plan to continue with its production cuts till April 2021. This effectively means that the petrol and diesel prices in India are headed to the ₹100 mark.
Currently, the highest fuel prices in India are in Mumbai where petrol is being sold at ₹97.57 per litre and diesel at ₹88.60 per litre. Among other metro cities petrol prices per litre in Delhi, Chennai and Kolkata are ₹91.17, ₹93.11 and ₹91.35. On the other hand, diesel prices per litre in these cities are ₹81.47, ₹86.45 and ₹84.35.
Oil marketing companies such as Bharat Petroleum, Indian Oil Corporation, and Hindustan Petroleum align the rates of domestic fuel with the global crude oil price, in line with the alterations in the foreign exchange rates. Additionally, domestic petrol and diesel prices vary across states due to the value-added tax (VAT). Above that, the central government too impose the tax on the fuel. Besides that, the retail price also includes the dealer's commission.
Petrol and diesel prices in India have witnessed a surge since January 2021 due to a rally in global crude oil prices. Oil Minister Dharmendra Pradhan urged the oil producers to ease output cuts and help the global economic recovery from the Covid-19 pandemic.
A few states have reduced their share of tax after the petrol price crossed ₹100 mark in states like Madhya Pradesh, Maharashtra and Rajasthan. The Finance Ministry too is thinking about reducing tax on fuel. Apart from that, there are discussions to bring petrol and diesel under the GST ambit to introduce uniformity in fuel prices.