The timing could not have been more perfect for a petrol price increase. Just a day after Presidential polls, the public sector oil companies hiked petrol prices by up to 90 paise a litre. Diesel prices remain untouched.
In a statement, Indian Oil Corporation said the increase in selling price, effective midnight tonight, shall vary by 70-91 paise a litre depending upon the State taxes.
This is the second hike during the current fiscal. The companies reduced prices twice.
According to the statement, “The revision has been necessitated due to increasing international oil prices and movement in rupee-dollar exchange rate.”
On June 28, the oil companies — Indian Oil Corporation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation — had reduced petrol prices by up to Rs 3 a litre, the second price cut during the month. In May, petrol prices were hiked significantly by Rs 6.28 a litre (excluding VAT/Sales Tax).
Petrol has been deregulated by the Government from June 25, 2010, allowing the oil companies to fix the selling price. But this was only on paper.
According to Indian Oil, the average price of India crude basket for the relevant pricing period considered is $101.28/barrel, while international petrol prices is $111.59 a barrel. The rupee-dollar exchange rate is around Rs 55.36 to a dollar. “At these levels, Indian Oil is incurring losses of about Rs 1.41 a litre on petrol sales in the domestic market,” the company said.