In September-2013, Indian Oil Corporation slashed the petrol prices by Rs 3.05 per litre, while diesel price has witnessed a hike of 50 paise, following the same tradition the oil company today announced reducing the prices of petrol again by Rs 1.15 a litre effective midnight, sadly by increasing the diesel prices again by 50 paise a litre.
While the petrol price is market-linked and revised periodically depending on crude oil price in the international markets, diesel is subsidised and the government has allowed the marketing firms to hike it by a “small amount” every month.
“Even after the current increase, under-recovery on retail diesel shall stand at Rs.9.58 per litre. The movement of prices in international oil market and INR-USD exchange rate is being closely monitored and developing trends of the market will be reflected in future price changes,” IOC, the country’s largest oil marketing firm, said in a statement.
A government panel headed by former Planning Commission member Kirit S Parikh Wednesday suggested an immediate increase of Rs.5 a litre in diesel prices. However, the government is unlikely to implement the expert panel’s recommendation due to political compulsions as elections are round the corner.