State-owned Indian Oil Corporation (IOC) announced on Saturday evening that it has hiked petrol prices by Rs 2 per litre, effective midnight, reports CNBC-TV18. The hike, IOC added, follows the steep fall in the rupee and the rise in global crude prices.
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According to the company's press release, prices of petrol were last revised on June 1 by Rs 0.75 per litre (excluding state levies) mainly on account of devaluation of the rupee.
Since the last price hike, the rupee continued to slide and fell from Rs 55.32/USD to Rs 57.08/USD. Further, international MS (motor spirit) prices have also hardened during this period. The combined impact of both these factors, mainly depreciation of the rupee, has warranted the increase in MS prices by Rs 2/litre (excluding VAT).
The above factors have also resulted in increase in under-recovery on sensitive products. Currently, OMCs suffer an under-recovery on sale of HSD (retail) of Rs 6.31/litre, SKO (PDS) of Rs.27.75/litre and LPG (dom) of Rs.335 per cyl. The estimated under-recovery of IOC on sale of these three sensitive products is estimated to be around Rs. 60,000 for the fiscal 2013-14 (industry estimates at around Rs. 1,12,500 crore).
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