POLLS OVER, PETROL METER TICKING AGAIN

Despite the spike in international crude rates, the oil PSUs had kept the rates unchanged for nearly three weeks. But two days after the Karnataka election wound up, refineries lost no time in announcing the new petrol and diesel prices. The new petrol rates for metro cities are: Rs 74.80 (Delhi), Rs 77.50 (Kolkata), Rs 82.65 (Mumbai) and Rs 77.61 (Chennai). Diesel prices are: Rs 66.14 (Delhi), Rs 66.68 (Kolkata), Rs 70.43 (Mumbai) and Rs 69.79 (Chennai). With this, diesel prices have touched a record high while petrol is at a 56month peak.

In the last 19 days, the prices remained constant despite fluctuations in international crude rates. Interestingly, Brent crude oil prices increased by about $3 (Rs 200) per barrel during this period when fuel prices in India remained unchanged. On April 23, the day before the last change in the prices of fuel in India, crude oil prices were around $74.50 per barrel. By May 11, a day before voting in Karnataka, the prices had increased by 3.7 per cent to about $77.50 per barrel. Interestingly, the oil PSUs had refused to acknowledge that there was any directive to keep the prices static in a bid to help the ruling BJP in the Karnataka elections. In fact, just last month Oil Minister Dharmendra Pradhan had denied reports of a directive to State-owned oil firms to absorb at least Re 1 a litre hike by not raising prices in line with cost.

Result: According to report in a leading news agency, stateowned oil marketing companies are estimated to have lost about Rs 500 crore as they absorbed the higher cost resulting from the spike in international oil rates and fall in the rupee against the US dollar. Attacking the ruling government, former Finance Minister P. Chidambaram took to his Twitter handle and wrote: “There we go again. More taxes on petrol and diesel, more burden on the consumer. The Karnataka election was only an interval”.