Diesel prices burn holes in pockets on account of firming crude oil price in the Indian basket

petrol diesel price hike

Diesel prices hit a new high when average rates in Delhi, Mumbai, Bangalore, Pune, Chennai and Noida recorded Rs 63.14 a litre on Friday.

Price of diesel per litre in Mumbai on Friday was a steep Rs 65.09.

Prices have been rallying since last week.

Fuel prices are now dynamic and unregulated which means prices change on a daily basis based on the crude oil rates and the demand and supply mechanism.

Under dynamic, or real-time, pricing, price of a product can vary as fixed by individual retailers across locations and duration of the day.

Retail fuel prices in the last six months rose by 11 percent during the period even as crude oil prices, jumped 45 percent to a three year high of around $69 a barrel.​

According to a report by BP Global, India imports about 80 percent of the oil consumed in the country. Government levies kept the prices high even as price of Brent retreated from $115 a barrel in 2012 to $28 in early February 2016. The fossil fuel began firming up again again on account of production cuts by the Organization of Petroleum Exporting Countries (OPEC) in January last year.

Ministry of petroleum andnatural gas in consultation with the finance ministry on 3 October 2017 lowered excise duty on petrol and diesel by Rs 2 each.

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