India is grappling with rising fuel prices as the cost of crude oil imports nears $100 per barrel, propelled by geopolitical tensions and fluctuations in global oil markets. This development has led to increased pressure on petrol and diesel prices across major cities in the country.
On Monday, the capital city of Delhi saw petrol prices at ₹102.12 per litre and diesel at ₹95.20. In Mumbai, the figures were even higher, with petrol priced at ₹111.21 and diesel at ₹97.83. Meanwhile, Gurgaon reported petrol at ₹102.97 per litre and diesel at ₹95.64. In Bengaluru, petrol was available at ₹110.82 per litre, while diesel was priced at ₹98.77. Bhubaneswar recorded prices of ₹108.97 for petrol and ₹100.68 for diesel. Chandigarh had comparatively lower prices, with petrol at ₹101.54 and diesel at ₹89.47 per litre.
The variation in fuel prices across different states is primarily due to differences in Value Added Tax (VAT), local taxes, and transportation costs. The surge in crude oil prices comes amid ongoing conflicts in West Asia, involving military engagements between the United States and Iran. Additionally, the benchmark Brent crude oil prices have seen an uptick, driving India’s crude import basket to its highest level in the past three months.
With India depending on imports for over 88% of its crude oil needs, domestic fuel prices are highly susceptible to changes in international oil prices. This sensitivity is compounded by a 7.9% rise in domestic petrol consumption in August, which reached 3.824 million tonnes.
Despite the increasing global costs, state-owned oil marketing companies, which manage over 90% of India’s petrol stations, have largely maintained stable retail prices for petrol and diesel. However, these companies are facing mounting challenges as they balance rising international crude prices with a relatively steady domestic pricing structure.