LPG prices down by Rs25 petrol, diesel again cheaper
29 Jan 2009
Prices of petrol and diesel were reduced for a second time since 5 December (See: Petrol, diesel prices cut), when prices of petrol and diesel were educed by Rs5 and Rs2 a litre, respectively, ahead of a stimulus package for the slump-hit automobile, export, real estate and infrastructure. LPG prices were left untouched. sectors.
The December price cuts came as the prices of crude oil fell to around $40 a barrel from around $147 a barrel in July last year (See: Oil plunges to levels around $42 a barrel) , with the Indian crude basket also hitting a fresh low at $43.17 a barrel, the lowest in the current fiscal and the lowest for the past four years, amidst a steady fall in global oil prices.
The government was expected to take a decision on further reducing the prices of petrol and diesel by Rs4 and Re1 a litre, respectively, as the government wanted to pass on the benefit of cheap crude oil to consumers ahead of the general elections.
Yesterday's price cuts lowered the price of petrol by Rs5 per litre, or 11 per cent, reducing pump prices from Rs45.62 to Rs40.62 in New Delhi and from Rs49.80 to Rs44.5 in Mumbai.
Similarly, the price of road transport fuel, diesel has again been brought down by Rs2, or 6 per cent from the retail price of Rs32.86 to Rs30.86 in the capital and from Rs36.69 to Rs34.44 in Mumbai.
This time round, the prices of LPG cylinders have also been brought down, by Rs25 per cylinder, possibly, with an eye to the approaching general elections, expected in April. Significantly, the price cuts have come before the election code of conduct comes into force once the election dates are notified.
Ther reduction in fuel prices in December had accelerated the pace of decline of inflation, which had fallen to 8.4 per cent for the week ended 22 November from a high of nearly 13 per cent in July, when oil prices had also peaked.
Petroleum Secretary R S Pandey said that the government would made good all the losses of state-run retailers after accounting for Rs32,000 crore contribution from upstream firms, through issue of oil bonds.
Oil Minister Murli Deora said no decision had been taken on deregulating fuel prices or changing the tax structure for the sector.
A government official had earlier said ministers were likely to end price controls on transport fuels and allow firms to set market-determined prices.
| Date | Inflation rate |
| 22 January 2009 | 5.6 per cent |
| 15 January 2009 | 5.24 per cent |
| 09 January 2009 | 5.91 per cent |
| 01 January 2009 | 6.38 per cent |
| 26 December 2008 | 6.61 per cent |
| 18 December 2008 | 6.84 per cent |
| 11 December 2008 | 8.00 per cent |
| 04 December 2008 | 8.40 per cent |
| 8.84 per cent | |
| 20 November 2008 | 8.90 per cent |
| 8.98 per cent | |
| 06 November 2008 | 10.72 per cent |
| 30 October 2008 | 10.68 per cent |
