In the steepest ever
hike, petrol price was increased on Wednesday by Rs 7.50 a litre with effect
from midnight tonight. State-owned oil firms said they will raise petrol price
by Rs 6.28 per litre excluding local sales tax or VAT. The hike translates into
Rs 7.50 per litre in Delhi.
Petrol in Delhi
currently costs Rs 65.64 a litre and after the increase it will be priced at Rs
73.14 per litre.
With rupee depreciation leading to jump in oil import bill,
Petroleum Minister S Jaipal Reddy on Tuesday had said that there was an
immediate need to raise fuel prices.
The government had
decontrolled petrol price in June 2010 but rates were last increased on
November 4 last year. This despite oil price rising by 14 per cent and 7 per
cent fall in value of rupee against the US dollar.
Price of deiself, kerosene and
cooking gas were raised in June last year.
“If rupee
depreciates by one against the US dollar, our oil companies lose Rs 8,000 crore
(annually),” Reddy said. “Rupee dipped (to an all-time low of) Rs 55
(to a US dollar). Last year it was Rs 46. This translates into a loss of Rs
72,000 crore (on account of rupee depreciation) this year.”
“Seeing all
this, something needs to be done, but when will it be done, how it will be
done, I cannot make a forecast,” Reddy had said.
State-owned oil
firms, who had in the fiscal ending March 31, 2012 lost Rs 4,860 crore on
petrol sales, are currently losing Rs 6.28 per litre on petrol. After including
20 per cent VAT, the desired increase in petrol price in Delhi comes to Rs 7.53
a litre.
Source: The Economic Times
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