Diesel prices have soared to an all-time high in Delhi and close to their peaks in other cities as strong international demand along with prolonged refinery shutdown due to hurricanes in the US belied previous expectations of a decline. Rising prices means hardship for diesel vehicle owners as well as farmers and consumers dependent on diesel-generated power.
On Monday, diesel was sold for Rs 59.07 per litre in Delhi, the highest for the period records are available on the website of Indian Oil Corp, which has data since 2002. Price of diesel is at a three-year high in Kolkata.
Prices are highest since May and January this year in Mumbai and Chennai, respectively. Diesel prices had touched their life-time peak in August 2014 in Kolkata, Mumbai and Chennai. At Rs 79.94/litre, price of petrol was highest on Monday in Mumbai since August 2014. Petrol prices in Delhi, Kolkata and Chennai were highest since January this year. Due to local levies, prices of petrol and diesel vary from state to state.
In Delhi, prices of petrol and diesel have risen by Rs 7.74/litre and Rs 5.74/litre, respectively since July 1. Most of the rise in a little more than a month was linked to spike in international rates after two successive hurricanes shut significant refinery capacity in the US. After big increases in fuel prices led to public uproar in the country mid-September, oil minister Dharmendra Pradhan said he expected prices to ease soon. But prices haven’t dropped. A prolonged refinery shutdown and higher diesel demand have pushed up crude prices.
Crude prices jumped nearly 12% between 1st and 25th September to reach $59 a barrel before slipping to $56 on Monday. Indian consumers have to pay a fuel price that is linked to international rates and topped with heavy central and state taxes. Prices are revised daily and are the average of the preceding 15 days’ international rates.
Policy push drives Oil sector
Several policy measures, a booming domestic demand and softer crude prices in the last three years have helped revive investment in the oil and gas sector. Reliance, BP, Rosneft, Cairn India, ONGC, Indian Oil and other firms have committed tens of billions of dollars in drilling more wells and expanding refining and marketing capacity. The new policies have put an end to disputes and acrimony in the sector, leading to value creation for all stakeholders. Here’s how… Read more
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