The Congress has led the opposition’s charge against the fuel hike and inflation in Parliament forcing several adjournments. The party lamented that the government failed to pass on the benefit of declining international crude oil prices to consumers, reports Amit Agnihotri
The fuel prices, which started rising in the country in March after a gap of four months, have contributed to high inflation and hit the people hard.
The fuel rates revision started March 22 after a gap of four and a half months during which elections in five states were held.
Ordinarily, the prices of petrol and diesel are revised daily, in line with a 15-day rolling average of benchmark international prices of petroleum products.
The oil marketing companies had held the prices of petrol and diesel constant for 137 days starting November 4, after the Centre announced an excise duty cut of Rs 5 per litre on petrol and a cut of Rs 10 per litre on diesel.
The entire impact of the rise in international crude prices during the period is being passed on to consumers now, as the oil companies have restarted price revisions.
The price of petrol has risen to Rs 104.6 per litre and the price of diesel has risen to Rs 95.9 in the national capital after 13 price hikes in 15 days.
The retail prices of petrol and diesel in the country depend on international prices of crude oil which have risen due to the ongoing Russia-Ukraine war.
That event pushed up Brent crude oil prices to $ 100 per barrel for the first time since 2014.
For the consumers the rates vary from state to state due to the impact of local taxes. On petrol and diesel, excise duty at around Rs 21 per litre is charged by the central government, while value-added tax VAT is charged by the state governments. VAT rates are high in metros like Delhi and Mumbai, explaining the high price of fuel there.
The central government can reduce the impact of higher crude oil prices by cutting excise duty while the states can reduce VAT on petrol and diesel to provide relief to consumers. Further, one per cent cess is also charged on petrol prices.
Freight charges depending upon the distance between the refinery and the retail station also contribute to different fuel prices in states.
In May, 2014 excise duty on petrol was Rs.9.20 per litre and on diesel it was Rs.3.46 per litre. Since then, the excise duty on petrol was increased by an additional Rs 18.70 per litre and on diesel by an additional Rs.18.34 per litre.
