After remaining stable for nearly a week, petrol and diesel prices declined on Tuesday by up to 9 paise and 11 paise respectively in major cities across the country following the dip in crude oil rates during the past few days.
Following the revision in fuel rates on Tuesday, petrol was priced in Delhi at Rs 71.19 a litre, Mumbai Rs 76.82, Chennai Rs 73.90 and Kolkata Rs 73.28 per litre, according to data available on Indian Oil Corporation website.
Similarly, diesel in Delhi was retailing at Rs 65.89 per litre, Mumbai Rs 69, Chennai Rs 69.61 and Koklata Rs 67.67 a litre.
Fuel prices remained unchanged for six straight days after they went up on 22 January. This month, the state-run oil marketing companies reduced fuel prices just three times due to the rise in crude oil rates in the international market and a weak rupee.
Petrol and diesel rates hit the highest level of this month in Delhi at Rs 72.27 per litre and Rs 66 on 22 January. Petrol and diesel rates rose by Rs 2.54 and Rs 3.23 respectively in Delhi since the beginning of this month.
Meanwhile, crude oil prices crept up on Tuesday after Washington imposed sanctions on Venezuelan state-owned oil firm PDVSA in a step set to severely curb the Organisation of the Petroleum Exporting Countries (OPEC) member’s crude exports to the United States.
Despite the move, which comes as the US government looks to pile pressure on sitting President Nicolas Maduro to step down, traders said ample global oil supply and an economic slowdown especially in China were keeping crude prices in check.
US West Texas Intermediate (WTI) crude futures were at $52.12 per barrel at 0351 GMT, up 13 cents, or 0.3 percent, from their last settlement.
International Brent crude oil futures were at $60.05 per barrel, up 12 cents, or 0.2 percent.
The United States has remained a major destination for Venezuelan oil despite their political differences, although volumes have declined over the past years amid Venezuela’s economic crisis and as the US government has started targeting the South American nation with sanctions.
The US government is supporting Venezuelan opposition leader Juan Guaido, who proclaimed himself interim president last week and is demanding the resignation of Maduro.
“As a result of today’s action, all property and interests in property of PDVSA subject to US jurisdiction are blocked, and US persons are generally prohibited from engaging in transactions with them,” the US Treasury said late on Monday.
“Persons operating in the oil sector of the Venezuelan economy may be subject to sanctions,” it added.
Venezuela has the world’s biggest proven oil reserves and is a member of the OPEC.
Despite its huge reserves, Venezuela’s exports declined to little more than 1 million barrels per day in 2018 from 1.6 million bpd in 2017, according to Refinitiv ship tracking data and trade sources.
The decline comes amid an economic crisis which has seen investment plummet, power and key equipment supplies disrupted, and salaries left unpaid.
While news of the sanctions against Venezuela grabbed headlines, analysts said the fundamental issue for global oil trade remained plentiful supply.
“The more significant issue is (global) supply, and despite OPEC’s best efforts (to reduce output) there seems to be plenty of it,” said Jeffrey Halley of futures brokerage OANDA in Singapore.
Global oil supply remains high largely due to a more than 2 million bpd increase in US crude oil production last year, to a record 11.9 million bpd.
There are also concerns in the oil industry that crude demand could stutter amid an economic slowdown.
— With Reuters inputs
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Updated Date: Jan 29, 2019 14:56:08 IST