Friday, April 19, 2024

Petrol, Diesel Likely to Cross Rs. 300 Mark for First Time in Country’s History

Due to recent global oil price hikes and the rupee’s decline against the US dollar, the Oil and Gas Regulatory Authority (Ogra) is expected to propose an increase in petroleum prices for the next two weeks. Reports suggest petrol might go up by Rs12 per liter, and diesel could rise by Rs14.83 per liter starting September 1, 2023.

This potential increase worries people because it could worsen the current 28% inflation rate. An official from the Energy Ministry said, “This would add to rising prices, making life even tougher for everyone.”

The government, already under pressure due to protests against high electricity bills, might choose to prevent the price hike to ease public concerns. However, doing so might put the caretaker government in a difficult spot.

The official added, “If the government goes this way, it might be seen as not following the IMF’s conditions for the $3 billion standby agreement (SBA) loan. These conditions require passing on changes in petroleum prices.” Currently, the US dollar is valued at Rs301.75 in the interbank market and about Rs319 in the open market.

In August, petrol and diesel prices went up by Rs37.50 and Rs40 per liter respectively. Before, authorities calculated fuel prices based on a dollar value of Rs287, but starting September 1, 2023, they’ll use Rs299 due to the Rs12 exchange rate impact.

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