Published: Tue, May 29, 2018
Money | By Hannah Jacobs

Petrol, diesel prices hiked for 16th straight day

Petrol, diesel prices hiked for 16th straight day

In Delhi petrol now cost record Rs 78.12 a litre, Mumbai Rs 85.93 per litre, Chennai Rs 81.11 a litre and Kolkata Rs 80.76 per litre. Petrol price has been hiked by Rs 3.49 per litre since May 14 and diesel by Rs 3.13 a litre. The price hikes mean petrol and diesel were now at their most expensive since 2015.

During his electoral campaign in 2014, Prime Minister Modi had attacked the Congress on rising fuel prices back then and said that under the BJP's rule, people would witness a steep decline in petrol and diesel prices, and the rupee-dollar exchange rate.

In states, petrol cost Rs 82.76 a litre in Hyderabad and in Bangalore Rs 79.40 a litre.

"Our analysis shows that at the current crude prices and extending our analysis to 19 states (overall consumption share is 93 per cent), the states could have gained at least an additional Rs 18,728 crore of revenue (in 2018-19)", said SBI's Ecowrap report. Whereas, Mumbai and Chennai saw the most hikes - by as much as Rs 3.59 per litre and Rs 3.62 per litre respectively.

On May 25, Road Transport and Highways Minister Nitin Gadkari had suggested that petrol and diesel should be brought under the Goods and Services Tax (GST) regime to curb the rise in price.

The government said it is likely to levy a "windfall tax", in the form of a cess, on companies like Oil and Natural Gas Corporation (ONGC) and Oil India (OIL) for any revenue that they earn from prices crossing $70 a barrel.

He also said that the weakening of the Indian rupee against the USA dollar was causing the fuel price hike.

It also said that one suggestion to further rationalise the petrol and diesel prices is to consider a pricing mechanism where VAT is imposed on base price only by states and not on prices inclusive of the Centre's tax.

Therefore, from May 14 till today, diesel prices have risen by Rs 3.38 per litre each in New Delhi and Rs 3.23 per litre in Kolkata.

This will push up the deficit of Centre, unlike states, it added.

Supermarket fuel prices have risen every day since the end of March, with average prices at the big four retailers going up by more than eight pence per litre.

It comes as prices at the pumps have already surged to a three-year high.

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