Shares in India’s major oil companies—Indian Oil, HPCL, and BPCL—rose by as much as 3.5% today. This spike followed an increase in the prices of premium petrol, which now cost between ₹2.09 and ₹2.35 more per liter. Regular petrol prices, however, remain unchanged for now.
The increase in premium petrol prices comes as state-run oil companies face rising costs due to the ongoing conflict in Iran. According to Elara Securities, every $10 increase in crude oil prices reduces their profit margins by approximately ₹6.3 for each liter of petrol and diesel sold. This pressure is significant.
The Indian government has so far avoided raising petrol and diesel prices. They can use excise duty as a buffer. For instance, the current excise duty stands at ₹19.9 per liter of petrol and ₹15.8 for diesel. Experts suggest that the government can maintain retail prices even if crude prices reach $110 per barrel via excise duty adjustments.
Despite the recent price hikes in premium petrol, the burden is still heavy on Indian Oil, BPCL, and HPCL. They continue to absorb these costs without any plans currently announced by the government to cut excise duties. It raises questions about long-term sustainability.
Interestingly, user reactions on social media show a mixed bag of concerns. Many people feel the pressure of rising fuel prices affecting their daily lives, while others are voicing their discontent towards the government’s handling of the situation.
In the past, such changes have sparked widespread protests and public outcry. For example, in 2018, significant hikes led to mass protests across the country. Essentially, keeping a close eye on these trends could offer insights into future consumer sentiment and potential government actions.
For more details on fuel prices and the economic implications of such changes, you can visit Hindustan Times.
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