Indian consumers saw stable petrol and diesel prices on September 26, a welcome relief amidst rising international crude oil rates. Despite Brent crude climbing above $104 per barrel, domestic retail fuel prices have not been adjusted, placing significant financial strain on state-run oil marketing companies (OMCs).
OMCs Face Mounting Losses
According to rating agency ICRA, India's OMCs are currently losing an estimated ₹530 crore every day. This substantial financial squeeze stems from the widening gap between the increasing cost of imported crude and the stagnant retail prices for petrol, diesel, and LPG across the country. The government has indicated that there is no immediate proposal to increase fuel rates, suggesting OMCs will continue to bear the brunt of the global price volatility.
City-Wise Fuel Prices on September 26
Here are the latest petrol and diesel rates in major Indian metropolitan areas:
- Mumbai: Petrol at ₹111.21/litre, Diesel at ₹97.83/litre
- Delhi: Petrol at ₹102.12/litre, Diesel at ₹95.20/litre
- Kolkata: Petrol at ₹113.51/litre, Diesel at ₹99.82/litre
- Chennai: Petrol at ₹107.76/litre, Diesel at ₹99.55/litre
- Bengaluru: Petrol at ₹111.68/litre, Diesel at ₹99.56/litre
- Hyderabad: Petrol at ₹116.15/litre, Diesel at ₹104.23/litre
Factors Influencing Domestic Fuel Prices
Several factors contribute to the variation in fuel prices across different Indian cities, even though the base price from oil refineries is uniform nationwide:
- State and Central Taxes: Taxes levied by both central and state governments constitute a significant portion of the final retail price. These taxes vary by state, leading to differing prices.
- Transportation Charges: The cost of transporting fuel from refineries to distribution points and then to petrol pumps adds to the final price.
- Dealer Commissions: Petrol pump dealers receive commissions on sales, which are also factored into the retail price.
- Rupee-Dollar Exchange Rate: India heavily relies on imported crude oil. A weaker rupee against the dollar increases the cost of crude procurement, potentially driving up retail prices.
Global events, such as fresh tensions in West Asia and attacks on key oil facilities, have also contributed to the upward trajectory of international crude prices. Despite these challenges, India's domestic fuel market has maintained stability for consumers, with OMCs absorbing the financial impact.