The rate increase follows international oil prices rising by a third from lows in October-end. Brent crude oil is nearing USD 50 per barrel mark on hopes that COVID vaccines would lead to demand recovery.
The government is faced with a new domestic trade-off between fiscal stability and sticky inflation.
Petrol and diesel prices rose for the sixth day in a row on Monday as rates went up by 26-30 paise per litre. Petrol price was hiked by 30 paise per litre and diesel by 26 paise, according to a price notification of oil marketing companies. Rates for petrol in Delhi rose to Rs 83.71 per litre, from Rs 83.41 while diesel price went up from Rs 73.61 to Rs 73.87 per litre.
This is the sixth straight day of price hike and the 15th increase in rates since November 20, when oil companies resumed daily price revision after nearly two-month hiatus. Rates are now at the highest level since September 2018. In 18 days, the petrol price has gone up by Rs 2.65 per litre and diesel rate has risen by Rs 3.41.
The rate increase follows international oil prices rising by a third from lows in October-end. Brent crude oil is nearing USD 50 per barrel mark on hopes that COVID vaccines would lead to demand recovery. Prior to the November 20 hike in rates in India, petrol prices had been static since September 22 and diesel rates hadn’t changed since October 2.
In Mumbai, petrol price rose to Rs 90.34 per litre from Rs 90.05, while diesel rates went up from Rs 80.23 to Rs 80.51. Rates vary from state to state depending on the incidence of local sales tax or VAT.