Oil prices may be revised after elections
OIL & GAS

Oil prices may be revised after elections

Oil marketing companies are set to revise fuel prices post-elections as Covid-induced disruptions have impacted the fuel demand adversely, and the country is witnessing a second wave of Covid now.

Petrol and diesel may see revision in pricing again after the conclusion of ongoing state elections. With crude oil remaining below Rs 4,871.09 a barrel, any softening on global oil in the wake of a fresh wave of the Covid-19 pandemic and rising oil stocks in the US could mean lower petrol and diesel prices for Indian consumers.

Before the long-drawn pause, petrol and diesel fell by 22 paise and 23 paise per litre respectively on March 30. Since then, the oil marketing companies have decided to pause price revision as they want to watch the crude price movement that has now fallen to around Rs 4,748.68 a barrel.

Fuel prices in India remained unchanged on Tuesday, with oil companies continuing with static pricing of petroleum and diesel for a fortnight now. Accordingly, petrol and diesel prices remained at the previous day's level of Rs 90.56 and Rs 80.87 a litre respectively in the national capital. Across the country as well, the petrol and diesel prices remain static on Tuesday, but its retail levels varied, depending on the level of local levies in respective states.

The oil marketing companies went on a price cut for the first time this year on two consecutive days━March 24 and 25━after keeping oil prices steady for the past 24 days. It again reduced the price on March 30. Fuel prices have remained unchanged after this.

Fuel consumption, an important barometer of the health of an economy, had shown contraction for the first time in two decades, falling by a big margin of over 9% in FY21 as Covid related lockdowns curbed economic activity and reduced the movement of goods and services across the country.

According to the Ministry of Petroleum and Natural Gas’s Petroleum Planning and Analysis Cell (PPAC), the country's total consumption of petroleum products fuelled two 195 million tonne (mt) in 2020-21 as against 214 mt in the previous financial year.

While FY21 numbers show a sharp decline, in March, India's fuel consumption rose to its highest since December 2019, growing by 18% to close to about 19 mt.

For FY21, the decline in consumption has been led by diesel that remained affected throughout the year as slim economic activities resulted in the lesser requirement of transport. Diesel consumption fell 12% to 73 mt while petrol demand shrank 7% to 28 mt.

Among petroleum products, only LPG consumption has grown as the government explored the scope of using the cleaner fuel under its Ujjwala Yojana to include one crore more households while cooking activity remained active during most of the lockdown.

Other products, including aviation turbine fuel (ATF) and naphtha, remained affected due to demand compression.

Image Source


Also read: Cess on domestic crude likely to be halved

Oil marketing companies are set to revise fuel prices post-elections as Covid-induced disruptions have impacted the fuel demand adversely, and the country is witnessing a second wave of Covid now. Petrol and diesel may see revision in pricing again after the conclusion of ongoing state elections. With crude oil remaining below Rs 4,871.09 a barrel, any softening on global oil in the wake of a fresh wave of the Covid-19 pandemic and rising oil stocks in the US could mean lower petrol and diesel prices for Indian consumers. Before the long-drawn pause, petrol and diesel fell by 22 paise and 23 paise per litre respectively on March 30. Since then, the oil marketing companies have decided to pause price revision as they want to watch the crude price movement that has now fallen to around Rs 4,748.68 a barrel. Fuel prices in India remained unchanged on Tuesday, with oil companies continuing with static pricing of petroleum and diesel for a fortnight now. Accordingly, petrol and diesel prices remained at the previous day's level of Rs 90.56 and Rs 80.87 a litre respectively in the national capital. Across the country as well, the petrol and diesel prices remain static on Tuesday, but its retail levels varied, depending on the level of local levies in respective states. The oil marketing companies went on a price cut for the first time this year on two consecutive days━March 24 and 25━after keeping oil prices steady for the past 24 days. It again reduced the price on March 30. Fuel prices have remained unchanged after this. Fuel consumption, an important barometer of the health of an economy, had shown contraction for the first time in two decades, falling by a big margin of over 9% in FY21 as Covid related lockdowns curbed economic activity and reduced the movement of goods and services across the country. According to the Ministry of Petroleum and Natural Gas’s Petroleum Planning and Analysis Cell (PPAC), the country's total consumption of petroleum products fuelled two 195 million tonne (mt) in 2020-21 as against 214 mt in the previous financial year. While FY21 numbers show a sharp decline, in March, India's fuel consumption rose to its highest since December 2019, growing by 18% to close to about 19 mt. For FY21, the decline in consumption has been led by diesel that remained affected throughout the year as slim economic activities resulted in the lesser requirement of transport. Diesel consumption fell 12% to 73 mt while petrol demand shrank 7% to 28 mt. Among petroleum products, only LPG consumption has grown as the government explored the scope of using the cleaner fuel under its Ujjwala Yojana to include one crore more households while cooking activity remained active during most of the lockdown. Other products, including aviation turbine fuel (ATF) and naphtha, remained affected due to demand compression. Image Source Also read: Cess on domestic crude likely to be halved

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