Fuel Prices on March 19: Petrol, diesel prices today in Mumbai, Delhi, Chennai & other cities

India imports more than 80 percent of oil requirement. It is feared that the war will spill over into India’s retail fuel prices soon. (Representative Image)

Petrol and diesel prices remained unchanged on March 19 in Delhi, Mumbai, Kolkata, and Chennai, a notification issued by state-owned fuel retailers showed.

In Mumbai, a cut on November 4 had reduced the price of petrol to Rs 109.98 a litre, and diesel to Rs 94.14 a litre.

Delhi had reduced the local sales tax, or the value-added tax (VAT), on petrol from 30 to 19.4 percent from December 1 midnight, bringing down the price by around Rs 8 to Rs 95.41 per litre for petrol. Diesel is at Rs 86.67 per litre.

In Kolkata, petrol and diesel prices remained at Rs 104.67 and Rs 89.79.In Chennai, petrol costs Rs 101.40 and diesel is sold at Rs 91.43.

In Noida, petrol is Rs 95.29 per litre and diesel Rs 86.80 per litre. In Lucknow, petrol costs Rs 95.28 and diesel Rs 86.80 per litre. In Jaipur, petrol costs Rs 107.37 per litre and diesel Rs 90.98 per litre. In Patna, petrol is at Rs 105.90 per litre and diesel at Rs 91.09 per litre.

Oil price well above $100 a barrel

On March 18 by 1245 GMT, Brent crude futures fell 0.3% to $106.35 a barrel after surging nearly 9% on March 17 as no easy replacement for Russian barrels appeared in sight. Also, peace talks between Russia and Ukraine made slim progress, raising the spectre of tighter sanctions and a prolonged disruption to oil supply.

Factors behind oil rally in last three weeks

The supply crunch from sanctions on Russia, dwindling oil stockpiles and worries about a surge of COVID-19 cases in China hitting demand, drove the oil prices rollercoaster ride over the last three weeks.

Prices rose on expectations that shortages will squeeze the energy market soon. In the last eight trading sessions, Brent oil per barrel has traded as high as $139 and as low as $98 - a spread of more than $40.

The United States on March 8 imposed sanctions on Russia since its invasion of Ukraine on February 24. It had banned purchases of Russian oil to punish Moscow.

Britain also on March 8 said it would phase out Russian oil imports by the end of this year, in line with new sanctions announced by the United States.

EU and Japan are also planning to put a ban on their exports to Russia and imports from the country.

Russia, which calls the military action a "special operation", is the world's biggest exporter of crude oil and fuel products.

On March 16, the International Energy Agency (IAE) said three million barrels per day (bpd) of Russian oil and products may not find their way to market beginning April as sanctions bite and buyers hold off.

Recently, Morgan Stanley raised its Brent price forecast by $20 for the third quarter to $120 a barrel, predicting a fall in Russian production of about one million bpd from April.

Oil prices tumbled to their lowest (Brent futures were down $7.89 or 7.3%, at $99.01 a barrel) in almost three weeks on March 15 as surging COVID-19 cases in China spurred demand concerns.

But the oil market largely shrugged off the US Federal Reserve's expected interest rate hike of one-quarter of a percentage point on March 16.

Retail oil price hikes likely

Hostilities between Russia and Ukraine, along with sustained demand, is expected to keep global crude oil prices high for some more time. India imports more than 80 percent of oil requirement. It is feared that the war will spill over into India’s retail fuel prices soon.

Experts earlier were of the view that the geopolitical crisis would push India's domestic prices of petrol and diesel by Rs 15-22 per litre. It was also expected that an excise duty cut may dampen the impact on petrol and diesel prices, but only to an extent.

JP Morgan earlier in its report said for oil marketing companies to revert to normalised marketing margins, retail prices need to increase by Rs 9 a litre or 10 per cent.