Write Comment     |     E-Mail To a Friend     |     Facebook     |     Twitter     |     Print

Fall in global crude prices could bring down the price of petrol by, at least, Rs.2.50 (including taxes). If the fall in global crude prices continues as expected till month-end, petrol could be available for around Rs.4 per litre, sources said on Tuesday.

A leading oil company official told Mail Today, "Petrol prices could be reduced by this month-end if the current trend of the rupee strengthening against the dollar continues in addition to the steep fall in international crude oil prices," said the official.

Oil companies review retail oil prices on 15th and 30th of every month. The price of petrol is linked to the global crude price and the rupee-dollar equation. India imported crude oil at $106 a barrel on March 16. It is currently trading at around $98 a barrel. However, a senior official of Indian Oil Corporation Ltd said that the company does not expect continued firming up of oil prices for a long period. "If there is a downward trend, reduction in petrol prices may not be that steep. There are several factors that go into working out the retail price of oil. We may necessarily not buy crude oil at the current rate.

We also buy and stock it even when crude oil prices are higher. If we cut retail oil prices steeply, increasing them later becomes difficult," the official added.

Currently, petrol costs Rs.66.09 per litre in the national capital. The price was reduced by Rs.2.40 on March 16, Rs.1 on April 2 and Rs1.20 on April 16.

Diesel prices will continue to be hiked by an average of 50 paise per month for the next 15 months as decided by the government earlier to do away with the subsidy of around Rs.6.50 a litre, an official from an oil company said. Crude oil futures prices rose by 0.65 per cent to Rs.4,807 per barrel on Monday after last week’s plunge. At the Multi Commodity Exchange, crude oil for delivery in May recovered by Rs31, or 0.65 per cent, to Rs.4,807 per barrel with a business turnover of 2,196 lots.

Market analysts said that the recovery in crude oil futures was attributed to a firming trend in Asia as traders bought up cheap crude following a price plunge last week on weak economic data from China.