Key principle of Modinomics - fool as many people as you can: Rahul Gandhi on fuel price hike

After a 19-day pre-Karnataka poll hiatus, petrol price was on Monday hiked by 17 paise a litre and diesel by 21 paise.

Pic courtesy: Twitter/@INCIndia

New Delhi: Congress president Rahul Gandhi on Monday slammed the Modi government over the hike in petrol price by 17 paise a litre and diesel by 21 paise after a 19-day pre-Karnataka poll hiatus. 

He tweeted, "Karnataka finishes voting, fuel prices rise to a four year high. The key principle of Modinomics - fool as many people as you can, as often as you can."

Karnataka finishes voting, FUEL prices rise to a 4 yr. high!

The Key Principle of Modinomics: fool as many people as you can, as often as you can. #PeTrolledhttps://t.co/TdRP20rfAb

— Rahul Gandhi (@RahulGandhi) May 14, 2018

PSU oil firms on Monday began passing on the spike witnessed in international rates to consumers. Petrol price in Delhi was hiked to Rs 74.80 per litre from Rs 74.63 while diesel rates were increased to Rs 66.14 a litre from Rs 65.93, according to a price notification issued by state-owned oil marketing companies. 

With this, diesel prices have touched a record high while petrol is at a 56-month peak. Oil PSUs, who had kept rates unchanged for nearly three weeks before Karnataka went to polls despite input cost spiking, reverted to daily revision in prices no sooner had the state voted to elect a new government on Saturday. 

State-owned oil marketing companies are estimated to have lost about Rs 500 crore as they absorbed higher cost resulting from the spike in international oil rates and fall in rupee against the US dollar, as per PTI.

Oil PSUs, which have been since June 2018 revising auto fuel prices on a daily basis to reflect changes in the cost, have kept pump rates static since April 24, an analysis of daily price notification issued by oil companies showed. 

Oil PSUs have refused to acknowledge if the freeze followed a government diktat so as to help ruling BJP in Karnataka. Oil Minister Dharmendra Pradhan had last month denied reports of a directive to state oil firms to absorb at least Re 1 a litre hike by not raising prices in line with cost. 

Petrol and diesel prices were last revised on April 24 when they were hiked by 13 paise each. But prices were frozen thereafter. This despite benchmark international rate for petrol going up from USD 78.84 per barrel, which was used for raising the price to Rs 74.63 a litre on April 24, to USD 82.98 now, according to sources privy to fuel pricing methodology. 

The benchmark international diesel rates during this period have climbed from USD 84.68 per barrel to USD 88.63. Also, the rupee has weakened to Rs 67 per US dollar from Rs 66.62, making imports costlier. 

State-owned oil companies in June 2017 dumped the 15-year old practice of revising rates on 1st and 16th of every month and instead adopted a dynamic daily price revision to instantly reflect changes in cost. 

The government had in June 2010 freed petrol price from its control and the diesel rates were deregulated in October 2014. Prices have since then moved more or less in tandem with international rates barring a few exceptions like the period before a crucial election. 

(With PTI inputs)