There were expectations in the market that fuel prices in India could now fall due to cheaper crude oil.
Oil marketers may take a long time to recoup losses worth over Rs 18,000, according to a report
Gasoline and diesel prices in India are unlikely to be cut anytime soon as oil marketing companies (OMCs) are recovering cumulative losses of Rs 18,000 crore on high crude prices in previous quarters, according to a report by CNBC-TV18, citing sources. There were expectations in the market that fuel prices in India could now fall due to cheaper crude oil.
Following bank failures in the US, including Silicon Valley Bank and Signature Bank, Brent crude prices have fallen to $75.03 a barrel, down from over $100 a dollar a year ago. Gasoline prices in India have been stagnant since May 2022 when Finance Minister Nirmala Sitharaman cut prices by Rs. 8 per liter of gasoline and Rs. 6 per liter of diesel by lowering the excise duty.
According to CNBC-TV18’s report, government sources said it could take a long time for the oil marketers to recoup losses of over Rs 18,000 and ruled out the possibility of a price cut at this stage.
In response to a question asked in Parliament, the Petroleum Ministry said on Thursday: “While the price of crude oil (Indian basket) in rupee terms per barrel increased by 23 percent from December 2021 to March 2023, the retail selling price of petrol and diesel in Delhi increased by only 1.08 percent and 3.40 percent, respectively.”
It added: “Gasoline and diesel prices have not been increased by public sector oil marketing companies (OMCs) since April 6, 2022, despite record high international prices. The three public sector OMCs, viz. IOCL, BPCL and HPCL posted a combined loss of Rs 18,622 crore from April 2022 to December 2022.”
On Friday, petrol is selling at Rs 96.72 per liter in Delhi while diesel is selling at Rs 89.62 per liter. Meanwhile, in Chennai, petrol is sold at Rs 102.73 per liter and diesel at Rs 94.33 per liter. Mumbai still has the highest price for petrol at 106.31 rupees per liter and diesel at 94.27 rupees per liter. In Kolkata, petrol costs stagnated at 106.03 rupees per liter while diesel is sold at 92.76 rupees per liter.
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