Gasoline and diesel prices rose by 80 Paise per liter; LPG up to ₹50

Petrol in Delhi now costs ₹96.21 per liter compared to ₹95.41 previously, while diesel prices have increased from ₹86.67 to ₹87.47.

Petrol in Delhi now costs ₹96.21 per liter compared to ₹95.41 previously, while diesel prices have increased from ₹86.67 to ₹87.47.

Gasoline and diesel prices were hiked by 80 paise a liter on Tuesday, while domestic cooking gas prices were hiked by ₹50 a bottle, ending a more than four-and-a-half month election-related hiatus in tariff revision, sources said.

Petrol in Delhi now costs ₹96.21 per liter compared to ₹95.41 previously, while diesel prices have increased from ₹86.67 to ₹87.47.

At the same time, the price for an unsubsidized liquid gas bottle in the state capital was increased to ₹949.50 per 14.2 kg bottle.

While LPG rates were last revised on October 6, 2021, petrol and diesel prices have been frozen since November 4, when five states including Uttar Pradesh and Punjab went to the polls.

LPG prices had risen by almost ₹100 per cylinder between July and 6 October 2021 before criticism stopped the price revision.

Both LPG and auto fuel prices have since frozen despite rising commodity costs, first due to a return in demand as economies around the world recover from the pandemic-induced slowdown, and then due to the Russia-Ukraine conflict.

Unsubsidized cooking gas is what consumers buy after exhausting their quota of 12 bottles at subsidized or below market prices.

However, the government does not subsidize LPG in most cities and the price of refilling, which consumers, including the poor women who got free connection under the much-discussed Ujjwala scheme, is the same as for unsubsidized or market-priced LPG.

Sources said a 5kg LPG bottle will now cost £349, while the 10kg composite bottle will cost £669.

The 19kg retail bottle is now £2003.50.

Since June 2017, petrol and prices have had to be adjusted daily to the international reference rate of the previous 15 days.

But prices have been frozen since November 4, 2021, shortly after Narendra Modi’s government cut the excise duty on petrol by ₹5 per liter and that on diesel by ₹10 per liter, bringing rates down from record levels. Most state governments also lowered the local sales tax, or value-added tax.

Before these tax cuts, the price of petrol had reached an all-time high of ₹110.04 per liter and diesel was ₹98.42.

These prices corresponded to Brent’s rise to a peak of $86.40 per barrel on October 26, 2021. Brent was at $82.74 on November 5, 2021 before starting to fall and $68.87 per barrel in December reached.

International oil prices started rising again this year, jumping to a 13-year high of $140 a barrel earlier this month. Brent was trading at $118.59 a barrel on Tuesday.

To make matters worse, the Indian rupee fell to a record low of £77 per dollar.

India relies on foreign purchases to meet about 85% of its oil needs, making it one of the countries in Asia most vulnerable to higher oil prices.

Double oil prices, already up more than 60% this year, and a weakening rupee could hurt the country’s finances, upending an emerging economic recovery and fueling inflation.

Petrol and diesel prices need to be increased by up to £25 a liter to allow fuel traders to cover the losses they have suffered by maintaining prices despite a rise in raw material costs, industry sources said.

Diesel sold to bulk consumers and industrial customers has already increased by around £25 a liter, suggesting the gap between retail pump prices and their true economic value.

The basket of crude oil that India is buying rose to above $128.24 a barrel on March 9, according to the Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC).

This compares to an average price of $81.5 per barrel for the Indian crude oil basket at the time of the gasoline and diesel price freeze four months ago.

But oil majors are not expected to pass on the entire loss at once and will moderate it – by increasing rates by less than a rupee a liter every day.

Since Russia stationed its armed forces on the border with Ukraine, international oil prices have been rising.

They rose after it invaded the eastern European nation amid fears that oil and gas supplies to energy giant Russia could be disrupted, either by the conflict in Ukraine or retaliatory Western sanctions.

While Western sanctions have so far prevented energy trading, the prospect of a full embargo on Russian oil and Russian products is leading to the recent rally in international oil prices.

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