New Delhi: The central government has once again stated that fuel prices are determined by the market and determined by oil marketing companies (OMCs), adding that the prices of petrol and diesel remain unchanged from June 2022. This is despite oil prices falling by a third since then.
The government has also not given an explanation as to why this is so. As per the existing dynamic pricing policy adopted by the Government, the fuel prices are to be revised daily based on the prevailing price of oil on that day.
In a written reply to a question regarding fuel prices in the Lok Sabha on Thursday, Union Minister of Petroleum and Natural Gas Hardeep Singh Puri said that the central government cut excise duty on fuel in two phases in November 2021 and May 2022 and the benefit of this reduction was passed on to consumers, resulting in a fall in retail prices of petrol and diesel.
In his reply, Puri also provided data on monthly price changes of petrol and diesel since April 2020. However, he did not give any details as to why the fuel prices have remained unchanged from June 2022.
“The prices of petrol and diesel have been market-determined with effect from 26.06.2010 and 19.10.2014 respectively,” Puri said in his written reply. He said that since then, “public sector oil marketing companies (OMCs) take appropriate decisions on pricing of petrol and diesel”.
Government decisions in June 2010 and October 2014 were aimed at keeping the price of petrol and diesel in India at par with the price of oil and revising them on a daily basis, unlike the previous policy under which they were revised on a fortnightly basis Was.
ThePrint had informed of In December 2022, despite this direct regulation of fuel prices, data showed that fuel prices remained mysteriously unchanged ahead of assembly elections, only to be changed soon after polling was over.
ThePrint too in May 2023 informed of How fuel prices remained unchanged for over a year. Those prices still haven’t changed.
To put this in context, oil prices according to the Indian basket of crude (the reference price that India uses) have fallen 32 percent since June 2022, while fuel prices have fallen zero percent since that time.
In his reply, Puri said, “The central government has cut central excise duty on petrol and diesel by Rs 13 per liter and Rs 16 per liter in two installments in November 2021 and May 2022, respectively.” He added that “the benefit of cut in excise duty was completely passed on to the consumers and as a result retail prices fell”.
“The measure is aimed at further boosting the economy and boosting consumption and keeping inflation low, thereby helping the poor and the middle class,” the minister said. He added that subsequently, many States/UTs have also reduced VAT rates on petrol and diesel.
ThePrint reached three oil marketing companies – Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation – for comment via call, but did not receive a response till the time of publication. This report will be updated upon receipt of a response.
However, in the past, these companies refused to comment on all queries on oil prices and instead referred them to the petroleum ministry.
(Editing by Amritansh Arora)
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