Shares of India’s oil marketing companies – Indian Oil, HPCL and BPCL – rose up to 3.5% today after hike in premium petrol prices. There was no change in “normal” petrol prices.
Prices of premium petrol – BPCL’s Speed, HPCL’s Power and IOCL’s XP95 – have been increased. ₹2.09- ₹According to ANI post on X, there is currently no change in the price of regular petrol.
State-owned Indian Oil Corporation Limited, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited are bearing the cost of the rise in crude oil prices due to the Iran war. Every $10 increase in crude oil prices reduces their margins. ₹According to Elara Securities, they sell Rs 6.3/litre petrol and diesel.
Certainly, fuel prices have increased globally.
- In the US, the price of gasoline is now 20% higher than before the Iran war.
- China has made the biggest increase in fuel prices since 2022.
- Fuel prices in Britain are at the highest level in 18 months.
- Fuel prices in Pakistan and Sri Lanka have increased by 20% and 8%.
Certainly, the government cannot postpone increasing petrol/diesel prices indefinitely. There is a buffer in terms of excise duty- ₹19.9 per liter petrol and ₹Rs 15.8 per liter diesel. According to experts, retail petrol/diesel prices can be completely protected by cutting excise duty by $110 per barrel.
At present, the government has not announced any plan to reduce excise duty and Indian Oil, BPCL and HPCL are considering it. The increase in premium petrol prices today will mitigate the impact, but only that much.
