Fuel price rise pauses after increasing for past seven days

Fuel price rise paused on Tuesday much to the relief of consumers faced with an unprecedented increase for the past one month that has taken retail rates to record high levels across the country.

In the national capital, petrol continues to be sold at Rs 104.44 per litre and diesel at Rs 93.17 per litre, the same levels as Monday. In India’s financial capital Mumbai, retail rates remained static at Rs 110.41 on Tuesday, the highest across all the four metro cities. Diesel also costs Rs 101.03 for one litre in Mumbai.

The price pause has come after fuel prices rose consistently for the past seven days, taking rates to an all-time high.

Petrol prices maintained stability since September 5, but oil companies finally raised the pump prices last week. Petrol has risen on 12 of the previous 14 days taking up its pump price by Rs 3.25 per litre.

While diesel prices have increased on 15 out of the last 18 days before Tuesday’s pause, taking up its retail price by Rs 4.55 per litre in Delhi.

OMCs had preferred to maintain their watch prices on global oil situation before making any revisions, but extreme volatility in global oil price movements has now pushed OMCs to effect the increase.

Rates of petrol and diesel are reviewed and revised by OMCs on a daily basis and the new prices become effective from 6 am.

The daily review and revision of prices is based on the average price of benchmark fuel in the international market in the preceding 15-days, and foreign exchange rates.

The fluctuations in global oil prices have prevented OMCs to follow this formula in totality and revisions are now being made with longer gaps. This has also prevented companies from increasing fuel prices whenever there is a mismatch between globally arrived and pump price of fuel.

(With inputs from agencies)

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