Prices of fuel extended its downward trend on Tuesday because of the huge fall in global crude oil prices last week. Petrol was pegged at Rs 74.07 a litre with a fall in Rs 0.42 paise in Delhi, while diesel was being sold at Rs 68.89 after a decrease of Rs 0.40 paise, according to the data in the Indian Oil Corporation website. In Mumbai, petrol was sold at Rs 79.62 per litre on Tuesday compared to Rs 80.03 on Monday. Diesel in Mumbai became cheaper by 43 paise to Rs 72.13 per litre as against 72.56 per litre the previous day.
In Chennai, petrol was retailing at Rs 76.88 per litre as against Rs 77.32 on Monday. In Kolkata petrol was sold at Rs 76.06 as against Rs 76.47 per litre. Diesel in Chennai and Kolkata was sold at Rs 72.77 and Rs 70.74, respectively.
Rates have been on the decline since October 18. This has wiped out all of the price hike on petrol in two months beginning August 16 and more than half on diesel. The reduction in diesel rates has been slower due to moderate fall in its benchmark international prices, according to oil company price notifications.
Oil prices slumped to its lowest level in 2018 on Friday after 8 per cent correction in prices. Brent crude oil futures hit their lowest since December 2017 at $59.04 per barrel. On Monday, it witnessed minor bounceback and was trading near $59.50 per barrel mark.
Petrol price had touched a record high of Rs 84 per litre in Delhi and Rs 91.34 in Mumbai on October 4. Diesel on that day had peaked to an all-time high of Rs 75.45 a litre in Delhi and Rs 80.10 in Mumbai.
Prices had started to climb from August 16. Petrol in Delhi was priced at Rs 77.14 per litre and in Mumbai it cost Rs 84.58 on August 15. Diesel on that day was priced at Rs 68.72 per litre in Delhi and at Rs 72.96 in Mumbai.
Between August 16 and October 4, petrol price was hiked by Rs 6.86 per litre and diesel by Rs 6.73.
On October 4, the government decided to cut excise duty on petrol and diesel by Rs 1.50 per litre each and asked state-owned fuel retailers to subsidise the price by another Re 1 a litre by reducing their margins. Subsequent to this, the petrol price came down to Rs 81.50 per litre in Delhi and diesel to Rs 72.95 a litre on October 5. In Mumbai, rates fell to Rs 86.97 per litre for petrol and Rs 77.45 in case of diesel.
Before the price cut, petrol in Delhi had hit an all-time high of Rs 84 per litre while diesel was at record Rs 75.45. This came down to Rs 81.50 per litre for petrol and Rs 72.95 in case of diesel.
The fall in fuel price come after the United States recently softened its stand on Iran's sanctions and allowed eight countries to continue importing oil from Iran temporarily. These countries are India, China, South Korea, Japan, Turkey, Italy, the United Arab Emirates, and Taiwan.