Diesel price crossed Rs 80 in Delhi for the first time on June 25, retailing at Rs 80.02 per litre, up by 14 paise compared to June 24. This makes diesel the more expensive fuel for the second consecutive day as petrol prices touched Rs 79.92 per litre – a 32 paise increase from June 24.
It also continues the trend of consecutive price hikes by oil marketing companies (OMCs) for the 19th day since June 8. The hikes began after a 83-day halt on revised pricing during the lockdown period.
The price of petrol in Mumbai reached Rs 86.70 per litre while diesel retailed at Rs 78.34 per litre on June 25. In Kolkata, petrol is Rs 81.61 per litre and diesel Rs 75.18 per litre for the day.
The state government’s increased value-added tax (VAT) on diesel since May is causing the fuel’s prices to soar in Delhi. VAT was increased to 30 percent for both petrol and diesel from 27 percent and 16.75 percent, respectively. Coupled with the Centre’s hiked excise duty of Rs 3 per litre since March 14 and then Rs 10 per litre on petrol and Rs 13 per litre on diesel since May 5 has affected prices.
The hike on diesel prices is unusual, as the government traditionally keeps the price for the fuel low due to its impact on agriculture and other high consumption economic activities.