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06-28-2012, 11:33 AM #1
Oil firms may cut petrol rates by Rs 4/litre
Petrol price may be cut by as much as Rs 4 a litre from July 1 as international oil prices fell to their lowest level since December 2010.
State-owned oil firms, which had last month hiked petrol price by a massive Rs 7.54 a litre before partially rolling it back by Rs 2.02 per litre, are due to consider revising rates at the end of this month.
"Yes, there is a scope for reduction in petrol prices. But I will not stick my neck out and say there will be a reduction for sure as we have to watch for volatility in the rupee as well," a top official at one of the three PSU oil retailers said.
State-owned fuel retailers, who as per practice revise rates of petrol on 1st and 16th of every month based on average imported cost and forex rates of the previous fortnight, had skipped changing rates on June 16.
Petrol at present costs Rs 70.24 a litre at IOC petrol pumps in Delhi.
He said the last revision was done keeping in mind an average of $115.77 per barrel rate of gasoline, against which domestic petrol prices are benchmarked.
Gasoline rates have since fallen to about $97 a barrel. But the rupee has devalued to Rs 57 to a US dollar from Rs 54.96 to a US dollar (average of first fortnight of June).
There was a scope to reduce petrol price by up to Rs 4 per litre but with rupee falling further, the cost of imports has again risen, he said.
"There is a lot of volatility in oil prices as well as value of rupee. We are watching the situation very closely," he said.