Srinagar, May 11: Petrol and diesel prices in India are likely to be increased before May 15 as state-run oil marketing companies (OMCs) face mounting losses due to the sharp rise in global crude oil prices, a media report says.
Oil companies are reportedly facing under-recoveries of nearly Rs 30,000 crore every month as international crude prices have jumped from around USD 70 per barrel to nearly USD 126 per barrel.
Despite the global oil shock, retail fuel prices in India have remained mostly stable so far, with both the government and OMCs absorbing a large part of the burden. India Today reported sources as saying that the government and oil companies are effectively absorbing up to Rs 24 per litre on petrol to protect consumers from a sudden price rise.
If the price revision is approved, petrol and diesel prices may rise by around Rs 4 to Rs 5 per litre, while domestic LPG cylinder prices could increase by Rs 40 to Rs 50. This would be the first major fuel price revision in nearly four years, as petrol and diesel prices have remained largely unchanged since 2022.
The pressure has increased because of the ongoing Middle East conflict, which has disrupted the Strait of Hormuz, a key route through which nearly 20 percent of the world’s oil supply passes. This has created supply concerns and pushed global crude prices sharply higher.
India has managed to avoid fuel shortages and rationing by increasing LPG production, cutting excise duties on petrol and diesel, and expanding crude imports from countries like Russia, the US, and West Africa. Refineries have also been operating at more than 100 percent capacity to ensure stable supply.
Officials said the government is closely watching the situation and is trying to balance rising financial pressure on oil companies with the risk of higher inflation for consumers before taking a final decision.—(India Today)
