Fuel prices hiked for 20th day in a row; Petrol, diesel price crosses Rs 80-mark in Delhi

Prices of fuel are increasing as state-run oil-marketing companies (OMCs) are reviving their market margins.

Fuel prices hiked for 20th day in a row; Petrol, diesel price crosses Rs 80-mark in Delhi

New Delhi: Fuel prices were hiked for the 20th day in a row on Friday with both petrol and diesel prices crossing Rs 80-mark in the national capital.

Following the fresh surge, Diesel is now priced at Rs 80.19 per litre and petrol will cost Rs 80.13 per litre in Delhi, taking rates up by Rs 8.87 for petrol and Rs 10.8 for diesel in 20 days.

In Kolkata, petrol is priced at Rs 81.82 per litre and diesel costs Rs 75.34. In Mumbai, petrol comes for Rs 86.91 a litre and diesel for Rs 78.51. In Chennai petrol is priced at Rs 83.37 a litre and diesel at Rs 77.44.

Diesel price for the first time in living memory crossed the rate of petrol in the national capital on Wednesday (June 24) hitting Rs 79.76 a litre.

Rates differ from state to state depending on the incidence of VAT.

However, diesel is costlier than petrol only in the national capital where the state government had raised local sales tax or VAT on the fuel sharply last month.

Traditionally, diesel was priced Rs 18-20 a litre lower than petrol due to lesser taxation. But over the years, the taxes have increased, narrowing the gap.

The Delhi government had on May 5 hiked Value Added Tax (VAT) on diesel from 16.75 per cent to 30 per cent and on petrol from 27 per cent to 30 per cent. Since the levy is ad valorem, the actual incidence has gone up every single time oil companies raised retail selling price in the last 20 days.

The 20th daily increase in rates since oil companies on June 7 restarted revising prices in line with costs after ending an 82-day hiatus in rate revision, has taken diesel prices to fresh highs.

Taxes make up for nearly two-third of the retail selling price. As much as Rs 50.69 per litre, or 64 per cent, in petrol price is due to taxes - Rs 32.98 is the central excise duty and Rs 17.71 is local sales tax or VAT.

Over 63 per cent of the retail selling price of diesel is taxes. Out of the total tax incidence of Rs 49.43 per litre, Rs 31.83 is by way of central excise and Rs 17.60 is VAT.