Despite the surge in global oil prices, state-run oil marketing companies (OMCs) have kept the retail prices of petrol and diesel stable across major cities on Tuesday
Despite the surge in global crude oil prices, state-run oil marketing companies (OMCs) have not raised the retail prices of petrol and diesel across major cities in the same measure in the last few days. Experts say the ongoing Lok Sabha election may be one of the considerations behind keeping petrol and diesel prices stable. Petrol is selling at Rs 72.95 per litre diesel in Delhi, while diesel is being sold at Rs 66.46 a litre.
In last ten days, there has been a minor fluctuation in the fuel prices. While the petrol and diesel prices saw a marginal increase of around 0.12% and 0.3% respectively across major cities of India, the global crude oil prices have jumped by almost 4% in the last ten days.
In the commercial capital of India, Mumbai, while the petrol costs Rs 78.52 a litre, diesel is selling at Rs 69.56 a litre. Petrol in Kolkata is being sold at Rs 74.97 per litre and diesel is at Rs 68.20 per litre, according to the website of Indian Oil Corp. In Chennai, people are buying petrol for Rs 75.71 a litre and diesel for Rs 70.17 per litre. Yesterday, petrol prices were raised by 5 paise while diesel prices were lowered by 7 paise across metro cities.
According to the market experts the surge in oil prices doesn’t augur well for the bottomline of OMCs. They said the global oil prices should not breach the level of $80 per barrel. The OMCs must not be raising prices because of market dynamics and elections could also be one of the reasons.
“The oil prices are market driven. If OMCs are not raising petrol diesel prices, it must be because of the older inventory or other factors. It is negative for the downstream oil companies as their margins will go down with the rise in oil prices while upstream companies need to do better when the oil prices go up,” Siddharth Sedani, Vice President, Equity Advisory, Anand Rathi Shares and Stock Brokers told Financial Express Online.
Yesterday, the crude oil prices soared by 3% after the world’s largest economy US announced its decision of not giving exemption to several countries from the sanctions for importing oil from Iran. The rupee also fell by 32 paise to 69.67 against the dollar on Monday after the announcement. India and China are among the largest importers of Iranian oil. India imports 80% of its oil requirements.
On Tuesday, in the international oil market, crude oil prices hit 2019 highs after the US said it would stop waivers from its sanctions by May this year. International Brent crude oil futures were trading at USD 74.40 per barrel, up 0.5 per cent from their last close.