The rupee depreciating to a 11-month low against the dollar is not only affecting India’s current account deficit and GDP growth, but is taking a toll on fuel prices too.
IndianOil Corporation Ltd has said it would revise petrol prices upward by Re 0.75 a litre and diesel by Re 0.50 per litre (excluding State levies) from Friday midnight.
After the revision, petrol would cost Rs 63.99 a litre (Rs 63.09) and diesel Rs 50.25 for every litre (Rs 49.69) in Delhi. The prices would vary from one State to another based on individual levies.
The revision in diesel price is applicable to retail sales. It is immediately not known if rates for bulk customers have also been changed.
“The current increase is required mainly due to depreciation of rupee from Rs 54.26 to Rs 55.32 for every dollar,” IndianOil said in a statement.
Prices of petrol were last revised downward by Rs 2.50/litre (excluding State levies) on May 1. Government-owned oil-marketing companies review petrol prices every fortnight to align it with market rates.
Petrol prices were witnessing a downward trend in the past three months from Rs 70.74/ litre in Delhi on March 2, to Rs 63.09/litre till March 31.
In addition, the Government has allowed oil-marketing companies to align diesel prices with market cost. Accordingly, diesel prices are being revised every month.
“In continuation of the above, IndianOil has decided to effect the aforesaid increase in diesel prices. Even after the current increase, losses on diesel shall stand at Rs 4.87 for every litre,” the largest oil marketing company said.
The price of non-subsidised LPG is cut by Rs 45, in Delhi it would cost Rs 802 a refill against Rs 847 per refill earlier.
The price for subsidised domestic cooking gas (quota of 9 refills every year for each consumer) remians unchanged.
Subsidy burden
Also, the oil marketing companies are selling every litre of kerosene at a loss of Rs 27.75 and every subsidised domestic cooking gas cylinder at Rs 334.50 below market cost.
Finance Minister P. Chidambaran expects the oil-marketing companies to incur losses of Rs 80,000 crore in 2013-14 for selling fuel below market cost.