Diesel prices rise, leave behind 2.50 price cut

The Indian government has played their trick of reducing fuel prices well as diesel prices continue to rise for the 10th consecutive day on Monday wiping out the Rs 2.50 per litre cut in rates which was announced earlier this month through excise duty cut and oil company subsidy.

The government had, with effect from October 5, cut excise duty on petrol and diesel by Rs 1.50 per litre and asked state-owned oil firms to subsidise the fuel by another Re 1 a litre. However, the retail selling price continued to rise on subsequent days.

While petrol price remained the same on Monday, diesel rates were hiked by 8 paise per litre, according to a price notification of state-owned fuel retailers.

With this, diesel prices have in the last 10 days been hiked by Rs 2.51 per litre.

It now costs Rs 76.42 in Guwahati as compared to Rs 73.96 per litre on October 5 and Rs 75.46 as compared to Rs 75.45 per litre in Delhi.

Petrol costs Rs 82.65 as compared to Rs 81.41 per litre in Guwahati and in Delhi the price is Rs 82.72 per litre which has witnessed an increase of Rs 1.22 per litre since the October 4 decision.

Petrol on October 4 was priced at Rs 84 per litre.

While in Delhi diesel rates are at their highest ever, in most the other states it is lower than the peak as some state governments had matched the Centre's move to cut excise duty and oil company subsidy by a similar cut in local sales tax or VAT. Diesel in Mumbai costs Rs 79.11 per litre, down from Rs 80.10 on October 4.

Petrol too in Mumbai is down from the peak of Rs 91.34 per litre on October 4 to Rs 88.18 on Monday. After the Centre cut excise duty by Rs 1.50 per litre and asked PSU oil firms to subsidise fuel by Re 1, Maharashtra and Gujarat governments were among the first to announce a matching Rs 2.50 cut.

They were later joined by Chhattisgarh, Jharkhand, Tripura, Uttar Pradesh, Madhya Pradesh, Himachal Pradesh, Haryana Assam, Uttarakhand, Goa, Arunachal Pradesh and Bihar with similar moves. Jammu and Kashmir, which is under governor's rule, too reduced tax on the two fuel.

Maharashtra, however, reduced VAT only on petrol and not on diesel.