State-run oil marketing companies increased prices of petrol and diesel for the fourteenth day in a row, even as the Narendra Modi government said it would formulate a policy to shield consumers from rising fuel prices.
The price of petrol was hiked by 15 paise today to Rs 85.93 a litre in Mumbai, while that of diesel was raised by 17 paise to Rs 73.53 a litre, according to data released by Indian Oil Corporation Ltd. Petrol and diesel are costlier by Rs 3.45 a litre and Rs 3.33 a litre, respectively, since May 14, when oil marketing companies resumed daily price revisions after a 19-day freeze in the run-up to the Karnataka elections.
The price hikes were triggered by the rally in oil prices, that took Brent crude to the $80-mark for the first time since 2014. That rally however stalled this week as Saudi Arabia said it expects OPEC and its partners to boost supplies later this year, easing restraints intact since early 2017. Brent crude dropped 3 percent on Friday to close at $76.4 per barrel.
Government Promises Long-Term Solution
Amid rising protests from opposition parties, the BJP government said it would work with state governments and public sector oil companies, to formulate a policy to keep fuel prices in check in the long term.
The policy will aim for the long-term stability of petrol and diesel prices so that customers do not have to bear the entire burden of rising international oil prices, Finance Minister Piyush Goyal told reporters yesterday. One of the possibilities is to bring fuel under the ambit of the Goods and Services Tax regime, Goyal said, adding that the GST Council members will discuss the idea in its next meeting.