Since mid-August, petrol price has risen by over Rs 3.5 a litre and diesel by about Rs 4 per litre as rupee hit record low against the U.S. dollar, making imports costlier.
A recent report by news agency Press Trust of India (PTI) quoted a top government official as saying that the government will not cut excise duty on petrol and diesel to cushion spiralling prices, as it has limited fiscal space available to take any dent in revenue collections. Following the hike, petrol and diesel quoted a record high of Rs 83.91 and Rs 76.98 a litre, respectively.
Since 1 August, petrol prices have risen by Rs 4.42 per litre and diesel prices have risen by Rs 5.01 a litre in the national capital, on the back of a depreciating rupee against the dollar and an increase in global fuel prices. Notably, the rapid fuel price hike in the country is caused due to a combination of rising in crude oil rates and fall of the Indian rupee against the USA dollar.
The fuel prices are likely to go up further as the rupee hit yet another all-time low of ₹72.
The prices continued to rise in other metro cities of India too.
Following the crisis, opposition parties on Thursday called for a Bharat Bandh on September 10.
The reduction in fuel price in Andhra was announced a day after Rajasthan slashed Value-Added Tax on fuel by four per cent. The Central government had raised excise duty on petrol by Rs 11.77 a litre and that on diesel by 13.47 a litre in nine installments between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October a year ago by Rs 2 a litre. The Centre now levies a total excise duty of Rs 19.48 per litre of petrol and Rs 15.33 per litre on diesel.
According to oil companies, petrol at refinery gate costs around Rs 40.50 a litre and diesel Rs?43.