Petrol and diesel prices in major Indian cities remained almost unchanged on Sunday, March 22.
Despite volatility in global oil markets due to the conflict in the Middle East and the consequent halt in shipping through the key Strait of Hormuz, petrol and diesel prices for regular customers in India have remained stable.
The three-week-old conflict in the Middle East erupted on February 28 after the US and Israel carried out joint strikes against Iran, prompting Tehran to retaliate.
Since then, the entire region has descended into chaos, with the Gulf countries routinely dealing with missile and drone attacks from Tehran.
The Strait of Hormuz, a key waterway for global energy trade, has also seen an effective shutdown of maritime traffic, with Iran threatening strikes against tankers passing through.
As a result, oil prices rose globally, with Brent rising from around $72 on February 27 to $112 on Friday.
Industrial diesel, premium gasoline have become more expensive
With rising prices piling pressure on margins, India’s state-run oil marketing companies (OMCs) hiked the price of industrial diesel and premium petrol on Friday.
Industrial diesel, which is sold in bulk to commercial facilities, saw a rise in prices ₹21.92 liters – an increase of 25%, while the price of premium petrol increased by ₹2 liters.
Regular prices of gasoline and diesel
However, the prices of regular petrol and diesel, which make up the majority of daily sales at the pumps, remained unchanged.
India’s three major OMCs – Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) – revise prices every day at 6 am to ensure rates are in line with international oil prices and exchange rate movements.
Below are the prices of petrol and diesel in major Indian cities as on March 22.
What Affects Petrol and Diesel Prices in India?
Petrol and diesel prices in India are affected by several factors, the most significant of which is the price of crude oil in international markets.
The rupee-to-dollar exchange rate also plays an important role in determining petrol and diesel prices, given that India imports a large portion of its oil requirements: a weaker rupee can increase the price of imported oil, push up fuel prices, or vice versa.
The third factor is taxes imposed by the Center and state governments, which form a major component of petrol and diesel prices and are responsible for fuel price fluctuations between states.
The final prices of gasoline and diesel are also affected by transportation costs and the dynamics of demand and supply.
