Petroleum products, specifically petrol and high-speed diesel (HSD), will see prices reduced by Rs2 to Rs3 per litre starting November 1. This adjustment aligns with a slight decline in global prices.
Sources familiar with the matter indicated that the international market saw average price decreases of approximately $1.5 for petrol and $2.5 for HSD per barrel over the past fortnight. Factoring in the latest exchange rates and prevailing tax norms, projections show petrol and HSD prices dropping by Rs3 and Rs2.30 per litre, respectively.
The government will confirm these new rates in an upcoming notification effective from November 1.
Furthermore, during the recent period, the import premium for both petrol and HSD has remained relatively steady at $8.7 and $5 per barrel, respectively. The exchange rate has also stabilized.
Currently, the ex-depot price for petrol is Rs243.03 per litre, while HSD is priced at Rs251.29 per litre.
On October 15, the government raised diesel prices by Rs5 per litre, maintaining the petrol price at Rs247.03 until the end of the month. This marked the first increase after three months of consistent declines due to falling international market prices.
Petrol, predominantly used in private vehicles and small transport means, significantly impacts the financial planning of middle and lower-middle-class households.
Conversely, the transport sector, which relies heavily on HSD, feels the inflationary pressures of its cost. HSD fuels large vehicles and farm equipment, affecting the pricing of essentials like vegetables.
Currently, the government imposes a tax of approximately Rs76 per litre on petrol and HSD. This includes a Petroleum Development Levy of Rs60 and a custom duty of Rs16 per litre. Oil companies and dealers also receive around Rs17 per litre from distribution and sales margins.
