On October 6, petrol and diesel prices across India's major metropolitan areas remained stable, defying a global crude oil market that has seen prices hover around the $100-per-barrel mark amidst escalating tensions in West Asia.
While state-run oil marketing companies (OMCs) have maintained retail fuel prices, absorbing the impact of higher international costs, Nayara Energy, a private player, implemented price increases of ₹5 per litre for petrol and ₹3 per litre for diesel at its outlets.
OMCs Face Mounting Pressure
The decision by state-run OMCs to keep prices unchanged comes at a significant cost. According to ICRA, these companies are currently incurring daily losses estimated at ₹530 crore due to the widening disparity between international fuel prices and domestic retail rates. This gap is squeezing their profit margins significantly.
Global oil prices remain elevated, driven by ongoing geopolitical uncertainties in West Asia and concerns over supply. Should crude prices continue their upward trend, India's substantial oil import bill is expected to rise further, potentially intensifying pressure on domestic fuel pricing in the coming weeks.
Current Fuel Prices in Major Indian Cities (October 6):
- Mumbai: Petrol at ₹111.21 per litre, Diesel at ₹97.83 per litre.
- Delhi: Petrol at ₹102.12 per litre, Diesel at ₹95.20 per litre.
- Kolkata: Petrol at ₹113.51 per litre, Diesel at ₹99.82 per litre.
- Chennai: Petrol at ₹107.76 per litre, Diesel at ₹99.55 per litre.
- Bengaluru: Petrol at ₹111.68 per litre, Diesel at ₹99.56 per litre.
- Hyderabad: Petrol at ₹116.15 per litre, Diesel at ₹104.23 per litre.
For daily commuters, this stability means no immediate shock at the pump, though current prices remain higher compared to previous years. Consumers are advised to monitor local rates, as city-specific taxes contribute to variations in retail fuel prices.
Why Fuel Prices Vary Across Cities
The primary reason for differing fuel prices from one city to another lies in a combination of local state taxes, transportation charges, and dealer commissions. While the base price of petrol and diesel from oil refineries is uniform nationwide, these local variables dictate the final retail price consumers pay.
Both central and state government taxes constitute a substantial portion of the final price, explaining the significant variations in petrol and diesel rates across different states and cities. Transportation costs and prevailing demand-supply dynamics also play a role in determining the retail price at the pump.