As fuel prices touch new highs, with petrol price crossing Rs 80 a litre mark in Delhi for the first time, Oil Minister Dharmendra Pradhan said that hike in prices is due to various global factors and not in India’s hand. He said that there are several reasons but the strengthening of the US dollar is causing problems.
“Today, the Indian currency is stronger as ever, in comparison to all other currencies. But how do we purchase oil? Through the dollar. Today, the dollar is, in a way, is wold’s biggest exchange currency. That is creating problems for us,” Union Minister Dharmendra Pradhan said as quoted by news agency ANI.
He said that besides dollar, the decision to increase oil supply by OPEC is not being compiled as per July-August data. Moreover, the geopolitical situation surrounding Venezuela and Iran is also adding pressure on production he said. Earlier, Arun Jaitley had also said that rise in fuel prices is due to external factors.
On one hand, there is pressure on the government to cut taxes, on the other, there are worries over widening current account deficit caused by higher trade deficit mainly due to jump in oil import bill. Until 2010, fuel prices were regulated but since it has been left up to oil companies to revise them according to market factors.
Last year, oil companies began daily revision of the prices instead of fortnight change. On Friday, fuel witnesses the steepest rise of about 50 paise in 14 months since daily price revision kicked-in.