New Delhi, December 17
The price of a basket of Indian crude oil has hit its lowest level since the start of the Ukraine conflict in February this year, but pump prices are still reigning as they were when prices were close to $130 a barrel.
Crude oil is trading at around $73 a barrel, down about 40 percent, and could fall even further in the coming days if China can’t shake itself off. economic slowdown due to the threat of Covid. In addition, commodity prices will remain under pressure due to sluggish global growth forecast by the World Bank and concerns over Russia’s incursion into Ukraine.
But domestic users are unlikely to benefit in the coming days in a recent directive from Petroleum Minister Hardeep Puri, who said state-run retailers have incurred losses of Rs 27,000 crore due to selling fuel at the pump at prices lower than imported. His testimony was that companies would want to use the cushion of lower global raw material prices to offset their losses.
Puri also indicated the government would not review high central fuel taxes, deflecting the issue when he was surrounded by opposition members in parliament last week. Instead, Puri pointed to six states, mostly ruled by the opposition, that have not cut local taxes and said prices in those states would fall if those states did.
The minister said that the retail prices of petrol and diesel in India have increased by 18.95 and 26.5 percent respectively in the last two years. During the same period, the average price of the Indian crude oil basket increased by 102 percent.