New Delhi, July 23 (IANS) India's oil marketing companies Monday announced a hike in petrol prices by 70 paise a litre, with effect from midnight, citing increasing international oil prices and decline in the rupee's value.
"It has been decided by Indian Oil Corporation to increase MS (motor spirit) prices by Rs.0.70 per litre (excluding state levies) with effect from midnight of July 23," Indian Oil Corp (IOC) said in a statement.
"The said revision has been necessitated due to increasing international oil prices and movement in INR-USD exchange rate," it added.
The average price of Indian basket of crude for the relevant pricing period considered is $101.28 per barrel while international petrol price is $111.59 per barrel. The rupee-dollar exchange rate is around Rs.55.36 per dollar.
The company said that at these levels, it is incurring losses of about Rs.1.41 per litre on petrol sales in the domestic market.
"However, as the price movement is quite volatile, it has been decided that an increase of Rs.0.70 per litre may be effected at this juncture and the situation watched for some time depending upon which a further view will be taken at an appropriate time," IOC said
During current financial year, the corporation has already accumulated losses of Rs.1,053 crore on petrol sales during the first two months due to high international oil prices, deterioration in rupee-dollar exchange rate and inability of oil marketing companies to revise petrol selling prices to desired level.
In addition, IOC said HSD (high speed diesel), SKO (kerosene) and LPG (cooking gas) selling prices remain unchanged since June 2011 resulting in current level of under recovery of Rs.10.01 per litre on diesel, Rs.27.20 per litre on kerosene and Rs.319 per cylinder on cooking gas.
"At these levels, projected under recovery of IOC during 2012-13 for these three products is Rs.86,000 crore. In these circumstances, the corporation is unable to bear burden of any further losses," it added.
Increase in petrol price shall vary from 70 paise per litre to 91 paise per litre (including state levies) depending upon state taxes.
In Delhi, the price increase will be 70 paise per litre. The impact of state tax shall be nil on the increase as per Delhi government's June 16 value added tax exemption order.
While in Delhi, the revised price would be Rs.68.48, it would be Rs.74.23 in Mumbai. In Chennai it will be Rs.73.16, while in Kolkata it will be Rs.73.61.
The revised prices in Hyderabad and Bangalore would be Rs.75.80 and Rs.77.30, respectively.