Petroleum fuel falls from a hand pump at a gas station operated by Bashneft PAO in Ufa, Russia. (Photographer: Andrey Rudakov/Bloomberg)

Petrol Dips Below Rs 74 Mark In New Delhi, Diesel Wipes Off Price Rise

Petrol price on Wednesday fell below Rs 74 per litre mark for the first time since April in New Delhi as the six-week long price reduction spree wiped off all of the massive hikes witnessed in fuel prices earlier this year.

Petrol price in Delhi was cut by 50 paisa to Rs 73.57 per litre, according to a price notification issued by state-owned fuel retailers. This is the lowest petrol price since April. Diesel rates were cut by 40 paisa to Rs 68.89 a litre, the notification said.

With this, the reduction in rates in last six weeks amounts to Rs 9.26 per litre on petrol and Rs 7.2 per litre on diesel. Rates have been on the decline since Oct. 18.

Petrol price had touched a record high of Rs 84 per litre in Delhi and Rs 91.34 in Mumbai on Oct. 4. Diesel on that day had peaked to an all-time high of Rs 75.45 a litre in Delhi and Rs 80.10 in Mumbai. Prices had started to climb from August 16.

Petrol price in Mumbai on Wednesday stood at Rs 79.12 per litre and diesel was priced at Rs 71.71.

On October 4, the government decided to cut excise duty on petrol and diesel by Rs 1.50 per litre each and asked state-owned fuel retailers to subsidise prices by another Re 1 a litre by reducing their margins. Many states including Maharashtra matched that with a reduction in local sales tax.

Since international oil prices have been falling and rupee has been gaining ground against the dollar, retail rates of fuel have also moderated. The retail selling price of petrol and diesel is dependent on the international prices of benchmark fuel and the rupee-U.S. dollar exchange rate. This is because a large proportion of country’s requirement is met through imports.

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