The government Saturday deregulated diesel prices by linking the fuel cost to market-based pricing.
The decision was taken by the Union cabinet in a meeting held here.
While announcing the decision on diesel price deregulation Finance Minister Arun Jaitley said: "Price of diesel will be linked to the market, and therefore, depending on whatever is the cost involved, is the element that consumers will have to pay."
"Just like petrol prices, diesel cost will now be governed by market forces. The diesel prices were being increased by 50 paise or so over the last few months."
According to Jaitley, the price of diesel will depend on the global crude oil costs and domestic demand.
"The prices should come down as the global crude oil prices have dropped substantially in the recent times," Jaitley added.
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