2016 Petrol Price Revision Friday January 15,2016

Petrol becomes cheaper by 32 paise, diesel by 85 paise/litre

Petrol price was on Friday cut by 32 paise a litre and diesel’s by 85 paise a litre, the fourth reduction in rates in six weeks on the back of softening global oil prices.

Petrol in Delhi will cost Rs 59.03 per litre with effect from midnight tonight as against Rs 59.35 per litre currently. A litre of diesel will cost Rs 44.18 as opposed to Rs 45.03 presently, said Indian Oil Corp (IOC), the nation’s biggest fuel retailer.

This the fourth reduction in rates since December 1. Rates were on that day cut by 58 paise a litre in case of petrol and by 25 paise in diesel. This was followed by a 50 paise a litre reduction in price of petrol from December 16 and 46 paise in case of diesel.

Petrol price, on January 1, was cut by 63 paise per litre and diesel’s by Rs 1.06 a litre.

The reduction would have been more but for government raising excise duty on the two auto fuel to take away some of the gains from the crude oil prices slumping to 12-year low of under USD 30 per barrel.

The government had on December 17 raised excise duty on petrol by 30 paise and that on diesel by Rs 1.17 per litre. This was followed by a 37 paise increase in the levy on petrol from January 3 and Rs 2 per litre on diesel.

The two duty hikes took away from customers benefit of 67 paise lower petrol price and Rs 3.17 a litre lower diesel rate but gave the government Rs 6,800 crore in additional revenue during the remainder of current fiscal.
“The current level of international product prices of petrol and diesel and Rupee-US Dollar exchange rate warrant a decrease in prices, the impact of which is being passed on to the consumers with this price revision,” IOC said in a statement.

State-owned fuel retailers IOC, Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) revise rates of petrol and diesel on 1st and 16th of every month based on average oil price and foreign exchange rate in the preceding fortnight

  Excise duty  hiked by Rs. 0.75 a litre on petrol and by Rs. 2 a litre on diesel Friday January 15,2016

NDA Government on Friday January 15,2016 hiked excise duty on petrol by Rs. 0.75 a litre and by Rs. 2 a litre on diesel, the second increase in duties in less than two weeks, to mop up over Rs. 3,700 crore in additional revenue.

The excise duty hike took away most of the gain which should have accrued to consumers from international oil prices slumping to 12 year low. Because of the excise duty hike, the reduction was limited to 32 paise a litre in petrol and 85 paise in diesel.

Basic excise duty on unbranded or normal petrol has been increased from Rs. 7.73 per litre to Rs. 8.48 and the same on unbranded diesel from Rs. 7.83 to Rs. 9.83 per litre, a notification of the Central Board of Excise and Customs (CBEC) said.

The increase in excise duty will fetch the government over Rs. 3,700 crore during the remaining period of the current fiscal.

This is the second hike in excise duty in less than two weeks as the government looks to make use of the slump in oil prices to shore up resources at a time when its disinvestment kitty is likely to fall way short of target.

The NDA Government had on January 2 hiked excise duty on petrol by Rs. 0.37 per litre and by Rs. 2 a litre on diesel to mop up a little less than Rs. 4,400 crore.

On December 17, 2015, it had raised excise duty on petrol by Rs. 0.30 per litre and Rs. 1.17 a litre on diesel to garner Rs. 2,500 crore.

Taken together with the November 7, 2015 increase in excise duty on petrol of Rs. 1.60 per litre and diesel by 30 paise to raise Rs. 3,200 crore, this is the fourth hike in levies this fiscal.

In the four increases, the government is expected to mop up over Rs. 13,700 crore to meet its budgetary deficit.