Diesel price in Delhi crosses Rs 82/litre for the first time ever

By: |
May 11, 2021 3:00 AM

Diesel was sold at Rs 82.06/litre on Monday, surpassing the previous all-time high rate of Rs 81.73/litre discovered last Friday. Petrol prices in the national capital also reached its record high on Monday, priced at Rs 91.53/litre.

The marketing margin of around Rs 3 per litre for diesel in Q4FY21 is the lowest encountered by OMCs in the last nine quarters.The marketing margin of around Rs 3 per litre for diesel in Q4FY21 is the lowest encountered by OMCs in the last nine quarters.

Retail price of diesel in Delhi crossed the Rs 82/litre mark for the first time in history on Monday, after state-run oil-marketing companies (OMCs) raised product prices to revive their marketing margins amid rising global crude oil rates. Diesel was sold at Rs 82.06/litre on Monday, surpassing the previous all-time high rate of Rs 81.73/litre discovered last Friday. Petrol prices in the national capital also reached its record high on Monday, priced at Rs 91.53/litre.

Auto fuel prices were seen to rise after the assembly elections as OMCs aim to improve their marketing margins. Analysts at Credit Suisse had said at the end of April that OMCs need to increase retail prices for diesel by Rs 2.8-3/litre and gasoline (petrol) by Rs 5.5/litre to maintain their FY20 margins. Diesel in Delhi was priced at Rs 80.73/litre and petrol at Rs 90.40/litre from April 15 to May 3. The marketing margin of around Rs 3 per litre for diesel in Q4FY21 is the lowest encountered by OMCs in the last nine quarters.

Legislative assembly elections were scheduled between March 27 and April 29 in Assam, Kerala, Tamil Nadu, Puducherry and West Bengal. “As in past instances, we expect OMCs to recoup the lost margins post elections if crude remains at current levels,” analysts at Jefferies had said mid-April, adding that “inadequate price hikes due to elections could weigh on BPCL’s privatisation”.

From the start of January, diesel price has increased 11% to the current level, while the cost of Indian basket of crude has grown 34% to $68.35/barrel in the same period. Of the retail diesel rates, Central government taxes comprise about 39% and state VAT another 14%. The Centre’s tax (basic excise, surcharge, agri-infra cess and road/infra cess) is currently Rs 31.80/litre for diesel and Rs 32.90/litre for petrol. In March and May 2020, the Centre increased the surcharge and cess on auto fuels by Rs 13/litre on petrol and Rs 16/litre on diesel.

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