Petrol price is on the boil, and may very well soon climb to highest ever in India’s history, if it rises by just 18 paise more. It may be noted that the diesel price had hit the highest ever ceiling long back, and has been making a new high almost every day since then. But petrol price is yet to be there. Now, the question how long will it take for petrol to hit the lifetime high mark in India’s history? The petrol prices were highest in four metro cities on September 14, 2013 — nearly five years ago, when crude oil price was about $112 a barrel.
Let’s take a case by case scenario. On September 14, 2013, the price of petrol in Delhi was Rs 76.06 a litre; today, it is 75.61. The price of petrol in Kolkata was Rs 83.63 a litre; today it is Rs 78.29. In Mumbai, petrol price was Rs 83.62 a litre; today it is Rs 83.45. In Chennai, petrol price was Rs 79.55; today it is Rs 78.46. In Delhi, it will take a hike of 45 paise; in Kolkata Rs 5.34; in Mumbai 17 paise; in Chennai Rs 1.09.
Thus, a hike of 18 paise or more in petrol price in Mumbai will have it breach the Kolkata’s record of Rs 83.63, which is highest ever recorded in India.
After a 19-day-long pause on price revision ahead of Karnataka polls, the fuel price has been increased by 13 paise to 29 paise in last five days. Speaking with FE Online, Madan Sabnavis, Chief Economist of Care Ratings explained that during polls, anti-people decisions are often deferred. But when the polls are over, fundamentals of economics take over, he said.
According to calculations done by brokerages, oil companies need to hike petrol price by Rs 4-4.55 per litre in the coming weeks if they are to return to pre-Karnataka poll hiatus margin levels, PTI reported. Unless there is state intervention via a cut in taxes, petrol prices are likely to shot up steeply and covering the gap of 45 paise in Delhi and 17 paise in Mumbai is not likely to take long. Rupee-US Dollar exchange rate may also play an important role in either accelerating or decelerating the price revision.