NEW DELHI, MAY 15 (PTI/AGENCIES): Petrol and diesel prices were raised by Rs 3 per litre on Friday for the first time in more than four years, as surging global crude prices following the Iran war forced state-run fuel retailers to pass on part of their mounting losses after months of holding rates steady through key state elections.
The increase pushed petrol prices in New Delhi to Rs 97.77 per litre from Rs 94.77, while diesel rose to Rs 90.67 from Rs 87.67, according to industry sources.
Rates vary across states due to differences in value-added tax. Compressed natural gas (CNG) prices were also raised by Rs 2 per kg in cities including Delhi and Mumbai. Global crude prices have surged more than 50 per cent since US-Israeli strikes on Iran on February 28 and Tehran’s retaliation disrupted flows through the Strait of Hormuz, a key artery for global oil shipments.
Despite the surge, retail fuel rates were kept frozen at two-year-old rates as part of what the government said was an effort to shield price-sensitive consumers from higher global energy costs. But the opposition parties saw political motives behind the move as key states went to polls. The increase in fuel prices followed the completion of elections and the ruling BJP expanding its influence after winning three of five states, including West Bengal. After the increase, petrol and diesel prices are now the highest since May 2022.
More calibrated hike likely in coming days
According to industry sources, more calibrated and staggered price hikes may be on the cards. A one-shot steep price hike would not have been politically palatable, and would have had a shock factor to it, industry sources told The Indian Express. Calibrated price hikes give the government the opportunity to pass on the higher prices to consumers gradually, while keeping a tab on public reaction and inflationary impact on an ongoing basis, instead of inflationary shock and the public backlash that a single steep hike might lead to. A few other analysts also expect more calibrated price hikes in the coming days.
Oppn attacks govt on fuel price hike
NEW DELHI, MAY 15 (PTI): Several opposition parties on Friday attacked the government over the hike in prices of petrol and diesel, warning that the move would worsen inflation and hamper economic growth.
The BJP, however, defended the hike, claiming that India managed to shield citizens from the global oil shock for more than two months while implementing only a “limited and calibrated” rise even as several countries witnessed steeper increases.
Congress leader Rahul Gandhi said the public was paying the price for the Modi government’s “mistake” while party chief Mallikarjun Kharge slammed the government, alleging that the country was facing an economic crisis due to a “leadership crisis, lack of vision and incompetence”.
CPI-M Polit Bureau strongly condemned the Centre for raising petrol, diesel and CNG prices, saying the hike would impose a greater burden on the people already reeling under inflation, unemployment, stagnant wages and deepening economic distress.
SP chief Akhilesh Yadav took a swipe at Modi’s call to conserve fuel, saying that the bicycle, SP’s official election symbol, was the only alternative, seemingly emphasising that his party alone could offer a solution.
TMC accused the Centre of “cheating” citizens after the elections and presiding over a worsening economic situation.
Tamil Nadu chief minister C Joseph Vijay said the fuel price hike was unacceptable and must be rolled back while AIADMK urged the Centre to take steps to reduce prices.