Diesel price hiked 50p/litre, no change in petrol cost

Non-subsidised LPG price cut by Rs 107 a cylinder

Diesel price was on Friday raised by 50 paise a litre but there will be no change in petrol rates.

The rise, effective from Saturday, is excluding local sales tax or value-added tax (VAT). The actual increase will be higher and will vary from city to city.

However, the price of non-subsidised cooking gas (LPG), which customers buy after consuming their quota of 12 subsidised cylinders, was cut Rs 107 a cylinder on easing international rates.

The price of diesel in Delhi will be raised by 57 paise, including tax, to Rs 54.91 per litre, while it will cost Rs 63.23 a litre in Mumbai as against Rs 62.60 at present.

The diesel price rise is in line with the January 2013 decision of the government to raise rates by up to 50 paise per month till such time the entire losses on the fuel are wiped out, and prices made market-determined.

Announcing the rise, Indian Oil Corp, the nation's largest fuel retailer, said even after the 13th price rise since last January, oil companies are incurring Rs 9.24 per litre loss on sale of the fuel. Officials said there would be no change in petrol rates, as the current price of Rs 72.43 a litre in Delhi was almost in line with the cost.

The 14.2-kg cooking gas cylinder that consumers buy beyond their entitled 12 bottles at subsidised rates, will now cost Rs 1,134, down from Rs 1,241, in Delhi.

Non-domestic LPG rates were at the beginning of the year raised by a steep Rs 220 per cylinder but have now been cut in line with a softening of international oil rates. IOC said losses on LPG have come down to Rs 656 per 14.2-kg cylinder from Rs 762.50. Diesel price was previously raised 50 paise on January 4. Since January 2013, diesel rates have risen by a cumulative Rs 7.76.

"Even after the current increase, under recovery (loss) on retail diesel shall stand at Rs 7.40 per litre," IOC said in a statement.

Besides diesel, IOC was losing Rs 35.76 a litre on sale of kerosene through the Public Distribution System (PDS) and Rs 656 on sale of each 14.2-kg subsidised domestic LPG cylinder.

"For the year 2013-14, the corporation is expected to incur under-recovery (revenue loss) of around Rs 73,700 crore on sale of three sensitive products and the industry (IOC plus Bharat Petroleum Corp and Hindustan Petroleum Corp) would incur around Rs 1,42,000 crore," the statement added.

On diesel, it said, the government had on January 17, 2013, authorised oil marketing companies to increase the retail selling price within a small range every month. "Accordingly, since then, retail diesel prices are being revised every month".