Petrol, diesel prices fall for second day as crude oil hits 7-week low

Petrol and diesel prices on February 9 have slumped for the second day on the back of low Brent crude oil price which has now settled below $65 per barrel after Iran announced to increase its production.The petrol and diesel prices were cut by 2 paise and 4 paise respectively.

According to Indian Oil’s website, the petrol price in Delhi was Rs 73.35 per litre; Kolkata Rs 76.04; Mumbai Rs 81.21; Chennai Rs 76.08, while the diesel price in Delhi was Rs 64.11 per litre; Kolkata Rs 66.78; Mumbai Rs 68.27; Chennai Rs 67.62.

The petrol and diesel prices have been surging on the back of rallying crude oil prices, which in the mid-January touched $70 per barrel mark amid the fears of the production cut by OPEC and non-members led by Russia. However, with Iran announcing to increase its oil production over the next four years, the oil prices began falling.

Meanwhile, higher US oil production is also a factor behind the fall. The Brent crude oil price was recorded $64.81 a barrel, while US WTI crude was down 64 cents, to settle at $61.15 a barrel, Reuters reported.

The fuel prices in India have been rising since October last year when the excise duty cut of Rs 2 per litre by the government was announced. Since then, till early February the Brent crude oil price surged over $13 per barrel, and subsequently, petrol and diesel prices by over Rs 5 and Rs 7 per litre.

Despite the cut for two straight days, petrol price continues to remain four-year-high and diesel price record high. The three-year-long low price oil windfall allowed the government to raise excise duty on petrol and diesel by Rs 12 per litre and Rs 13.77 per litre respectively, before announcing the cut in October.

It was earlier reported that to cushion the impact of rising fuel prices, the government may announce an excise duty cut in the Budget 2018, however, it is understood that tight fiscal situation left no room for the relief. On Wednesday, anticipating a rise in crude oil prices, along with other factors, the Reserve Bank of India kept the repo rate unchanged with the neutral stance.