Fuel price rise paused a day after reaching new highs

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New Delhi, May 26 (IANS) A day after the hike, oil marketing companies (OMCs) on Wednesday again paused increase in the pump prices of petrol and diesel across the country, looking to wait and watch global oil price movement before making their next move.

Accordingly, petrol price remains at Rs 93.44 per litre and diesel Rs 84.32 per litre in Delhi.

Across the country as well the fuel prices remained static on Wednesday after rising by 20-27 paise per litre a day earlier but their retail prices varied depending on the level of local taxes in states.

The pause has come not before fuel prices reached new highs. In Mumbai, petrol is now being sold at Rs 99.71 a litre, just one increase short of crossing another milestone of Rs 100 per litre pricing. The price pause has delayed this climb by a day or two.

The Rs 100 per litre mark has already been breached in few other cities in Maharashtra, Rajasthan and Madhya Pradesh. Premium petrol prices have been hovering over Rs 100 a litre for past few couple of months now.

With Wednesday’s price pause, fuel price has increased and remained unchanged on 13 days each so far in the month of May. The 13 increases in May have taken up petrol prices by Rs 3.04 per litre in Delhi. Similarly, diesel have increased by Rs 3.59 per litre in the national capital.

Under daily price revision, OMCs revise petrol and diesel prices every morning benchmarking retail fuel prices to a 15-day rolling average of global refined products’ prices and dollar exchange rate. However, in a market where fuel prices need to be increased successively, oil companies this month have been holding back price rise on few days before starting the process all over again.

IANS had written earlier that OMCs may begin increasing the retail price of petrol and diesel post state elections as they were incurring losses to the tune of Rs 2-3 per litre by holding the price line despite higher global crude and product prices.

With global crude prices rising again to around $69 a barrel mark, OMCs may have to keep revising prices upwards for some more time. Global oil prices are also expected to remain firm after entry of Iran back into the oil trade after dilution of US sanctions seems getting delayed.