Petrol, diesel near record highs as OMCs continue daily revision of prices

 Petrol prices hit a record high of Rs82.06 a litre in Mumbai today, the highest in 55 months, while diesel was priced at Rs69.70 as state-run oil marketing companies continued to raise prices citing high international prices of crude oil.

The highest petrol price was recorded in September 2013, when it touched Rs83.62 a litre in Mumbai.
Effective 6.00 am today (21 April), petrol will cost Rs82.06 a litre in Mumbai, Rs76.99 a litre in Chennai, Rs76.91 in Kolkata and Rs74.21 in Delhi.
Diesel, which hit a new all-time high now costs Rs69.70 in Mumbai, Rs69.06 in Chennai, Rs68.16 in Kolkata and Rs65.46 in Delhi.
Prices of sensitive petroleum products have been rising since deregulation and the pace has increased with state-run oil marketing companies started following a policy of daily revision of selling prices.
Diesel prices were deregulated in September 2014 while petrol prices were deregulated much before during the UPA regime.
Petrol was priced at Rs80 per litre in Mumbai on 13 May 2014 and diesel was costing around Rs65.21 per litre when crude oil prices had hit levels around $105 a barrel. But, even with international crude prices ruling around $75 now, retail prices of petrol and diesel are above the May 2014 levels.
Former finance minister P Chidambram, in series of tweets, questioned the logic of prices of petrol and diesel going above the May 2014 levels when crude oil prices are around $74 per barrel, which is way lower than the $105 a barrel it hit four years ago.
“For the last four years, the BJP government has lived off an oil bonanza. Minus the oil bonanza, the BJP government is clueless and floundering," added Chidambram.
While the government had benefited from falling petroleum prices, Chidambaram said, it failed to reduce taxes when the prices of petrol and diesel went up. He suggested that petroleum products be brought under GST.
As of now, excise duty and VAT account for over 47 per cent of the price of petrol and 38 per cent of the retail price of diesel in Delhi. This applies to almost all states.
Industry officials say they have no control of the market and that fuel prices can come down only when crude oil starts coming down.
The only way to arrest rising fuel prices and reduce the burden of inflation on the common man then is by reducing taxes.