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NEW DELHI : The increase in petrol and diesel prices continued on Friday, with state-owned oil marketing companies (OMCs) raising transportation fuel prices for the fourth day in a row.

Petrol and diesel prices were increased by 28 paise per litre and 31 paise per litre, respectively, in the national capital, and were retailing at Rs91.27 per litre and Rs81.73 per litre at state-run Indian Oil Corporation Ltd's outlets.

This comes against the backdrop of fuel demand dipping amid a second wave of covid-19 raging across India, the world’s third-largest oil importer and the fourth-largest buyer of liquefied natural gas.

Rating agency Standard and Poor's has cautioned that India’s second wave could knock off 1.2-2.8 percentage points from its 11% GDP growth estimate for FY22, derailing what has been a promising recovery in the economy, profits, and credit metrics in the year to date.

The cost of the Indian basket of crude, which comprises Oman, Dubai and Brent crude, was $67.60 a barrel on 6 May. Following the covid outbreak, crude prices for Indian basket of crude had plunged to $19.90 last April before recovering to $63.40 a barrel in April, data from the Petroleum Planning and Analysis Cell showed.

Interestingly, diesel and petrol retail prices in India had remained subdued assembly elections were being held across five states, with three government-run OMCS—Indian Oil Corp. Ltd (IOCL), Bharat Petroleum Corp. Ltd (BPCL) and Hindustan Petroleum Corp. Ltd (HPCL)—refraining from raising prices. The state-run OMCs and the government have maintained that there is no correlation between elections and transportation fuel price freeze.

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