Oil marketing companies on Thursday increased the prices of petrol and diesel after keeping the retail prices unchanged for the past couple of days.
The pump price of petrol increased by 17 paisa per litre on Thursday to Rs 82.66 a litre in Delhi from a level of Rs 82.49 a litre a day earlier.
Similarly, the diesel price increased by 19 a litre to Rs 72.84 a litre in the national capital as compared to Rs 72.66 per litre on the previous day.
The prices of auto fuel have also increased across the country but the level of rise has been different depending on the taxation structure in each state.
In the past 14 days, due prices have risen 11 days with petrol prices rising by Rs 1.60 per litre and diesel by Rs 2.38 a litre.
The increase has been primarily on account of firming up of global oil and product prices following news of successful coronavirus vaccine.
Petrol prices had been static since September 22, and diesel rates hadn’t changed since October 2.
Though retail pricing of petrol and diesel has been deregulated and oil marketing companies were following a daily price revision formula, the same was suspend ended for almost two months to prevent volatility in international oil markets from impacting fuel prices regularly during the pandemic.
But with crude on the boil again on news of a successful coronavirus vaccine launch soon, the patience was lost by OMCs who finally resorted to price increase to cover for their under recovery on the sale of two petroleum products.
The benchmark Brent crude has crossed $48 a barrel on Intercontinental Exchange (ICE) lately. It has remained an over $44 a barrel for most part of November.
OMCs need almost 40 paise per litre increase in retail price of petrol and diesel to cover for $ 1 increase in crude.
Going by this yardstick, product prices would have to be increased by upto Rs 2 per litre to cover under recovery on its sale.