(Image source from: PTI)
On Friday, petrol and diesel costs were increased by Rs 3 per litre due to the growing pressure from the rise in global crude oil prices caused by the ongoing conflict in West Asia, reported the news agency PTI. As a result of this change, the price of petrol in Delhi went up from Rs 94.77 to Rs 97.77 per litre, and diesel prices rose from Rs 87.67 to Rs 90.67 per litre. Furthermore, petrol prices in other big cities went up as well, reaching Rs 108.74 per litre in Kolkata, Rs 106.68 in Mumbai, and Rs 103.67 in Chennai, with increases ranging from Rs 2.83 to Rs 3.29 per litre. Diesel prices also saw a significant rise in metropolitan areas, reaching Rs 95.13 per litre in Kolkata, Rs 93.14 in Mumbai, and Rs 95.25 in Chennai. Additionally, in Delhi, CNG prices were raised by Rs 2 per kg, going from Rs 85 to Rs 87.
Up until now, India had managed to avoid a significant increase in retail fuel prices in spite of the soaring global crude oil costs and the worsening conditions in West Asia. The recent Rs 3 per litre hike only addresses a small portion of the pressure resulting from the conflict in West Asia, according to sources cited by PTI. State-run oil companies had kept retail fuel prices unchanged for almost 11 weeks, despite increasing input costs, but eventually had to pass on some of the burden as losses grew and it became harder to maintain operations financially. Since April 2022, petrol and diesel prices had mainly stayed the same, with the exception of a single Rs 2 per litre reduction announced in March 2024 before the Lok Sabha elections. Indian Oil Corporation, Bharat Petroleum Corporation Ltd, and Hindustan Petroleum Corporation Ltd stopped daily price changes in April 2022 to protect consumers from the global oil crisis caused by Russia's war against Ukraine. While the three companies initially faced significant losses, they later managed to offset some of those losses as crude prices began to fall.
Nevertheless, the new conflict in West Asia has caused global energy prices to rise sharply once again. The average price of the crude oil that India imports, which was around USD 69 per barrel in February before the conflict intensified, has surged to nearly USD 113-114 per barrel. There had been increasing speculation of another wave of fuel price increases as global crude oil prices continued to rise amid the escalating conflict in West Asia. In an earlier conversation with India Today this week, Infomerics Ratings Chief Economist Manoranjan Sharma mentioned that the chances of a fuel price change had significantly increased due to international market factors rather than policy issues. “With Brent crude exceeding $105 per barrel, it is very likely that fuel prices will increase after May 15,” Sharma stated.
As rumors about a big increase in fuel prices circulated, gas stations in various states saw a large number of customers. Many people hurried to fill up their tanks before any price change took effect. A report from India Today showing 15 gas stations in Delhi-NCR, Uttar Pradesh, Gujarat, Odisha, and Bihar found that there were long lines and more people wanting fuel. Drivers rushed to refill their vehicles because they were worried about a large rise in petrol and diesel prices. Many customers chose to fill their tanks completely after hearing that fuel prices might go up by Rs 5 to Rs 20 per litre starting May 15.
