Petrol, diesel prices to witness a steep hike after polls? Check by how much rates could increase

New Delhi: Petrol and diesel prices in India that have remained stagnant since November 4, 2021, could start increasing from next week. According to repots, oil marketing companies will need to increase the price by more than Rs 12 by March 16, 2022, to break even. 

"Auto fuel net marketing margin is minus Rs 4.92 per litre on March 3, 2022, and Rs 1.61 in Q4 FY22-to-date…However, net margin is likely to plummet to minus Rs 10.1 per litre on March 16 and minus Rs 12.6 on April 1 at latest international auto fuel prices," ICICI Securities said. 

According to a Reuters report, the Indian government will start increasing petrol and diesel prices next week for the first time in more than four months. Sources quoted n the report noted that the oil companies will be free to increase petrol prices in a phased manner. 

India currently imports 80% of its oil needs. Oil marketing companies haven’t increased the prices of petrol and diesel in the country since November 4. However, once the state assembly elections are done and dusted, the firms are likely to hike prices starting next week. The companies are facing huge losses, the report pointed out. 

The Centre and several state governments had cut the taxes on petrol and diesel in November 2021. The government could further decrease the taxes on the fuel in April to make it affordable.

In the recent past few days, crude oil has touched record highs. On Thursday, the price of Brent increased to more than $116 a barrel. The global prices of other products such as wheat, soybean, fertiliser and metals, including copper, steel and aluminium, have also surged amid the crisis in Ukraine.  

Rising retail fuel prices would have a direct impact on prices of household goods and services depending on energy intensity, Saugata Bhattacharya, chief economist at Axis Bank, told Reuters. Also Read: Russia-Ukraine War: Samsung suspends shipments to Russia, announces $6 million in aid

"However, the RBI’s Monetary Policy Committee (MPC) is unlikely to immediately start tightening monetary policy, given widespread multi-dimensional uncertainties on growth momentum," he was quoted as saying. Also Read: Garena Free Fire Max Redeem Codes for today, March 5: Check how to get free rewards