Fuel prices cut by 1 paisa, not 60
NEWDELHI: After a continuous hike in fuel price for 16 consecutive days, Wednesday saw a marginal cut by 1 paise, but it came with its share of confusion.
The Indian Oil Corporation Ltd website showed a reduction in petrol price by 60 paise while diesel was down by 59 paise. The oil marketing company (OMC) soon realised the error and rectified it. “There was a technical glitch in posting the selling prices of petrol and diesel on our website today (Wedneday),” the OMC said in a statement.
After the reduction, petrol price stood at ~78.42 and diesel at ~69.30 in Delhi. Meanwhile, after the opposition Congress launched an attack on the Kerala government, the state on Wednesday reduced local taxes on petrol products by ~1. The revised price will come into effect from June 1. It became the first and only state so far to reduce local taxes after fuel prices rose unabated for 16 consecutive days.
According to the Indian Oil website, the petrol price in Thiruvananthapuram stood at ~82.61 and diesel price at ~75.19 on Wednesday. OMCs revise fuel prices everyday based on international crude price, currency fluctuation among other factors, to reflect it on their websites at 6am daily.
Crude prices softened as Saudi Arabia and Russia said they are discussing reviving output as prices jumped to levels last seen in 2014.
Brent futures that traded above $80 a barrel last week slumped to around $75 on Monday. But the fall in international price did not translate to immediate cuts in retail prices, as OMCs had stopped price revision during the Karnataka polls, and were adjusting the losses made.
Faced with mounting pressure, the government has begun a huddle to look at long-term solutions to tackle sudden spikes in global crude prices.
The central government levies a duty of ~19.48 a litre on petrol and ~15.33 per litre on diesel, while states collect sales tax and VAT which ranges from 26% to over 47% (Mumbai) of the fuel cost that consumers pay. States also have a 42% share in the Centre’s revenue collections so there has been demand that they also cut the local taxes on fuel.