After skipping rate revision on September 16, Oil marketing companies cut petrol prices by 54 paisa a litre on the back of softening international oil rates. After accounting for the incidence of local sales tax, petrol rate in Delhi was reduced by 65 paisa to Rs 67.86 per litre, while in Mumbai, petrol price was cut by 68 paisa to Rs 75.73 per litre. Petrol price was last cut by a steep Rs 1.50 a litre, excluding state levies on August 31.
However, a reduction in diesel rates, the first since January 2009, was put on hold till the return of Prime Minister from the US as the oil ministry felt it did not have a clear mandate to slash rates post the January 2013 decision of the Cabinet to raise prices by 40-50 paisa a litre every month.
Since January 2013, diesel prices have been hiked nearly every month by 50 paise a litre. Over the last 20 months, the price of the fuel has been hiked 19 times, resulting in a total increase of Rs 11.81 per litre. However, the rate cut is being considered for diesel after softening international oil rates wiped out the under-recovery for fuel, rather there was an over-recovery of 35 paise a litre from September 16, which has further grown by Re 1 per litre.
Oil minister Dharmendra Pradhan has reportedly written to Modi on the emerging scenario. Also, the ministry has written to the Election Commission seeking their concurrence for the price decrease in view of state assembly elections in Maharashtra and Haryana.