NEW DELHI: With the Organization of the Petroleum Exporting Countries (OPEC) cutting crude oil production, petrol and diesel prices in India continue to rise. State-run fuel retailers today increased the price of petrol by 7 paise a litre and diesel by 10 paise a litre.
Since the beginning of this year, the price of petrol has gone up by about ₹3.5 a litre and that of diesel by about ₹5 a litre.
A litre of petrol now costs ₹72.24 a litre in Delhi, ₹77.87 in Mumbai, ₹75.02 in Chennai, ₹74.64 in Bengaluru, ₹72.37 in Gurgaon and ₹74.33 in Kolkata. Diesel, on the other hand, costs ₹67.64 a litre in Delhi, ₹70.86 in Mumbai, ₹71.49 in Chennai, ₹69.88 in Bengaluru, ₹66.76 in Gurgaon and ₹69.43 in Kolkata.
A study of fuel price movements shows that during the last few months petrol prices have been rising faster than those of diesel, thereby narrowing the gap between the two types of automobile fuel. This happens primarily because of a difference in international benchmark rates for both types of fuel.
Although crude oil prices were on the decline today as China cut its 2019 economic growth target and dimmed the outlook for fuel demand, the price of Brent crude oil has increased by more than 6.5% during the last three months.
US West Texas Intermediate (WTI) crude oil futures were trading above $56 per barrel while Brent crude futures were above $65 per barrel.
"Near term ... it is hard to get very bullish on oil prices. The market is still working off the surpluses built in H2 2018, keeping OECD commercial inventories stuck above the five-year average," energy analysts at economic research firm TS Lombard told Reuters.
Oil demand growth has been flagging along with an economic slowdown, especially in Europe and Asia.