The government on Friday slightly raised the price of petrol by Re1 per litre and that of high-speed diesel (HSD) by Rs7 for the next fortnight.
A press release from the Finance Division said the new prices were decided after Ogra reviewed and adjusted consumer prices for petroleum products given “recent fluctuations in the international oil market”.
The new petrol price is Rs257.13 and that of HSD is Rs267.95.
Any changes in the prices of light diesel oil and kerosene oil were not mentioned.
Informed sources had earlier said the ex-depot petrol price was estimated to go up by Rs2-3 per litre depending on the final calculation today. Kerosene and diesel prices were estimated to rise by about Rs6 per litre.
The estimates were based on the bullish trend in the international market. The Brent prices have risen by up to $2 per barrel last fortnight.
These sources said the average prices of HSD increased by more than $2.50 per barrel in the international market while that of petrol inched up by about 50 cents per barrel last fortnight. The ex-refinery cost of kerosene also went up. Import premium on petrol increased by around 40 cents to $8.84 per barrel while it remained unchanged on diesel. The exchange rate also generally remained stable.
As a result, the latest calculation as of Jan 29 showed an increase of around Rs5 to Rs6 per litre in both HSD and kerosene and about Rs2-2.50 per litre in petrol.
The ex-depot petrol price is Rs256.13 and HSD Rs260.95 per litre. Kerosene’s official rate is Rs169.25 per litre, but it is seldom available at this rate in the market.
Petrol is primarily used in private transport, small vehicles, rickshaws, and two-wheelers, and it directly affects the budget of the middle and lower middle classes.
Most of the transport sector runs on HSD. Its price is considered inflationary as it is mainly used in heavy transport vehicles, trains and agricultural engines like trucks, buses, tractors, tube wells and threshers and particularly adds to the prices of vegetables and other eatables.
Currently, the government is charging about Rs76 per litre tax on petrol and HSD. Although the general sales tax is zero on all petroleum products, the government charges Rs60 per litre PDL on both products, which usually impacts the masses.
The government also charges about Rs16 per litre of customs duty on petrol and HSD, regardless of their local production or imports. In addition, about Rs17 per litre distribution and sale margins are charged by oil companies and their dealers on both products.