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Thursday, December 29, 2022

Petrol-diesel will be cheaper, rates can be reduced by this much rupees, understand the whole math

Petrol-diesel will soon be cheaper.

Petrol-diesel will soon be cheaper.


Petrol and diesel may soon become cheaper in India. After remaining level for a long time, the prices may fall by up to Rs 14 in the coming days. The steep fall in crude oil prices in the international market has rekindled hopes of a possible reduction in fuel prices in India.

International benchmark Brent crude fell to its lowest level since January on Monday, falling more than 3% to $80.97. At the same time, the rate of crude oil in the US market is around $74. The fall in Brent crude oil prices has brought down the cost of the Indian basket, ie the price at which Indian companies buy oil, from the March average of $112.8 to $82 a barrel.

If you look at the figures of the last eight months, the price of crude oil for Indian refiners has come down by $ 31 (27%). According to the SMC report, after a drop of $ 1 in the price of crude oil, the buying oil companies save 45 paise per liter. In such a situation, the price of petrol and diesel should be reduced by Rs 14 in the present time.

The prices have remained stable since May 22 except now when the prices were reduced after the cut in excise duty. Petrol and diesel prices were increased by Rs 10 per liter before the April freeze. Petrol currently costs Rs 96.72 a liter in the national capital and diesel costs Rs 89.62. Petrol and diesel rates have remained stable for the last 6 months.

Government reaction on petrol and diesel prices

Earlier this month, Oil Minister Hardeep Singh Puri had said that state-owned oil companies were still making a net loss of Rs 4 per liter on diesel, while they were making profits on petrol. After the fall in crude oil prices since the beginning of the year, companies have now turned profitable. If you look at all the equations, then the rates of petrol and diesel can be reduced. If the price reduction happens, it will be the first cut since May 22 when the government cut excise duty to protect consumers from higher global prices and check inflation. However, the oil companies argue that they are compensating for the loss caused by the increased crude oil prices.

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