Petrol prices were kept changed today while diesel prices were cut by 7-8 paise a litre in top cities. Petrol retailed at 70.29 in Delhi, 72.38 in Kolkata, 75.91 in Mumbai and 72.94 in Chennai. Diesel retailed at 64.57 in New Delhi – the lowest in the national capital since the start of this fiscal year (April). Diesel was being sold at 66.33 in Kolkata, 67.58 in Mumbai and 68.18 in Chennai. Petrol and diesel prices have been on a down trend since hitting a record high in October. In Bengaluru, petrol retailed at 70.86 a litre and 64.93.

Petrol and diesel prices are dependent on international prices of crude and the rupee-US dollar exchange rate as India imports bulk of its oil requirement through imports. Since October, global oil prices have tumbled nearly 30% amid concerns over oversupply and worries on global growth. Currently, Brent crude currently trades near $61 a barrel, far lower than October highs of $86. The rupee has also rebounded to around 71.80 a dollar, pulling back from October lows of 74.48.

On October 4, petrol prices had a record high of 84 per litre in Delhi and 91.34 in Mumbai. Diesel on the same day had also peaked to an all-time high of 75.45 a litre in Delhi and 80.10 in Mumbai. From its October 4 highs, diesel prices are off 11-12.50 a litre while petrol prices are down 13.50-15.50 a litre. And from the start of this month, petrol prices are down 2.5 a litre while diesel prices are off 3 to 3.5 a litre.

Apart from global oil prices and the dollar-rupee exchange rate, the price of petrol and diesel that consumers pay at the pump depends on taxes levied by the centre and states and dealer commission. Based on November 19 retail selling price of diesel of 71.39 in Delhi, this is the break-up of prices according to Indian Oil website: Price charged to dealers (excluding excise duty and VAT) 44.52, excise duty 13.83, dealer commission 2.55 and VAT 10.49.

According to latest data, India’s fuel demand fell 1.8% in November compared with the same month last year. Consumption of fuel, a proxy for oil demand, totalled 17.27 million tonnes, data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry showed.

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