Nationwide hike in petrol, diesel prices for first time in 83 days

Petrol and diesel prices were hiked by on Sunday by 60 paisa per litre following an 83-day hiatus. The decision to hike the base price after nearly 80 days was taken by state-run oil marketing companies.

As per records, petrol and diesel prices were last revised on March 16, prior to the nationwide lockdown. Multiple state governments, on the other hand, have hiked the VAT or cess on fuel prices to make up for loss of revenue during the ongoing novel coronavirus outbreak.

Maharashtra on May 30 announced an additional cess of Rs 2 per litre each on petrol and diesel. An official had clarified that the state government was looking at increased revenue of Rs 3,000 crore in the current financial year as a direct result of the hike.

Similarly, the Jammu Kashmir government increased the tax on petrol by Rs 2 per litre and diesel by Re 1 per litre on May 29. Other states that took the same route include Himachal Pradesh, Jharkhand, Punjab, Odisha, Haryana and Delhi.

In May, the Government of India had decided to hike excise duty on petrol by Rs 10 per litre and on diesel by Rs 13 per litre. This, however, led to no change in retail prices since the hike was balanced against a drop in crude oil rates.

After a record fall in April of this year, India’s fuel demand was seen on a path to recovery in May. According to reports, sales of petrol and diesel by state-run fuel retailers fell by 28 per cent and 47.5 per cent, respectively, in the first two weeks of May. When compared, the sale of petrol and diesel had declined by 56.5 per cent and 61 per cent respectively in the month of April.