Fuel prices across India saw a substantial hike of ₹3 per litre for both petrol and diesel on May 15, ending a period of relative stability. This sharp increase is attributed to ongoing volatility in global crude markets, particularly amid tensions in West Asia and disruptions to key shipping routes.
New Prices in Major Metros
The price adjustments have pushed retail fuel costs significantly higher in major metropolitan areas:
- In Delhi, petrol now costs ₹97.77 per litre (up from ₹94.77) and diesel is ₹90.67 per litre (up from ₹87.67).
- Kolkata saw petrol rise to ₹108.70 and diesel to ₹95.13 per litre.
- In Mumbai, petrol is now ₹106.68 and diesel ₹93.14 per litre.
- Chennai residents will pay ₹103.67 for petrol and ₹95.25 for diesel.
- Other cities like Hyderabad and Bengaluru also experienced similar hikes, with petrol reaching ₹110.89 and ₹106.21 respectively, and diesel at ₹98.96 and ₹94.10.
Consumer Reaction to the Hike
The revision, though officially announced on May 15, was preceded by widespread speculation, prompting many consumers to rush to petrol stations nationwide. Reports indicated long queues forming at fuel outlets and several pumps displaying "No Fuel" boards as stations struggled to cope with the sudden surge in demand. Many motorists opted for full-tank refills, fearing further price escalations.
Factors Driving Fuel Prices in India
Several interconnected factors influence the retail price of petrol and diesel in India:
- International Crude Oil Prices: As the primary raw material, global crude oil prices have the most significant impact on what consumers pay at the pump.
- Rupee-Dollar Exchange Rate: India heavily relies on imported crude. A weaker rupee against the US dollar increases the cost of crude procurement, which translates to higher retail fuel prices.
- Central and State Taxes: Both the central and state governments levy various taxes, duties, and cesses on fuel, which constitute a substantial portion of the final price. This is a key reason why prices vary across different states.
- Transportation Costs: The cost of transporting fuel from refineries to distribution points and then to petrol pumps also adds to the retail price.
- Demand-Supply Dynamics: Local demand and supply conditions can also play a role in minor price variations.