New Delhi: Diesel price rose for the 10th consecutive day Monday to wipe out all of the ₹ 2.50 per litre cut in rates announced earlier this month through excise duty cut and oil company subsidy. The government had, with effect from October 5, cut excise duty on petrol and diesel by ₹ 1.50 per litre and asked state-owned oil firms to subsidise the fuel by another Re 1 a litre. However, the retail selling price continued to rise on subsequent days.
While petrol price remained static Monday, diesel rates were hiked by 8 paise per litre, according to a price notification of state-owned fuel retailers.
With this, diesel prices have in the last 10 days been hiked by ₹ 2.51 per litre. This is the fastest increase in rates since oil firms implemented daily price revision in mid-June last year. It now costs ₹ 75.46 per litre in Delhi, a shade higher than ₹ 75.45 a litre price when the government on October 4 announced the excise duty cut in 12 months.
Petrol costs ₹ 82.72 per litre and has witnessed an increase of ₹ 1.22 per litre since the October 4 decision. Petrol on October 4 was priced at ₹ 84 per litre.
While in Delhi diesel rates are at their highest ever, in most the other states it is lower than the peak as some state governments had matched the Centre’s move to cut excise duty and oil company subsidy by a similar cut in local sales tax or VAT.
Diesel in Mumbai costs ₹ 79.11 per litre, down from ₹ 80.10 on October 4. Petrol too in Mumbai is down from the peak of ₹ 91.34 per litre on October 4 to ₹ 88.18 on Monday.
After the Centre cut excise duty by ₹ 1.50 per litre and asked PSU oil firms to subsidise fuel by Re 1, Maharashtra and Gujarat governments were among the first to announce a matching ₹ 2.50 cut.
They were later joined by Chhattisgarh, Jharkhand, Tripura, Uttar Pradesh, Madhya Pradesh, Himachal Pradesh, Haryana Assam, Uttarakhand, Goa, Arunachal Pradesh and Bihar with similar moves. Jammu and Kashmir, which is under governor’s rule, too reduced tax on the two fuel.
Maharashtra, however, reduced VAT only on petrol and not on diesel.
Even before the excise duty cut, Rajasthan, West Bengal, Karnataka, Kerala and Andhra Pradesh had last month reduced VAT to cushion consumers for a spate of price increases.
The reduction in excise duty, only the second in four years of BJP-led NDA rule, will dent Central government revenues by ₹ 10,500 crore and was aimed at cooling retail prices that had shot up to an all-time high.
The BJP-government at the centre had raised excise duty on petrol by ₹ 11.77 a litre and that on diesel by ₹ 13.47 a litre in nine instalments between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by ₹ 2 a litre.
Prior to October 4 cut, petrol price had risen by ₹ 6.86 a litre and diesel by ₹ 6.73 since mid-August.
This story has been published from a wire agency feed without modifications to the text.