Petrol, diesel prices hiked second time this month on weak rupee; crude falls by 1% as US increases supply

Petrol and diesel prices increased by 38 paise and 29 paise respectively on Thursday in major cities across the country after the fuel rates remained unchanged for two consecutive days. The rate hike is attributed to the rise in crude in the international market earlier this week and the weakening rupee.

After the revision of fuel prices on Thursday, petrol was sold in Delhi at Rs 68.88 a litre, Mumbai Rs 74.53, Chennai Rs 71.47 and Rs 71.01 in Kolkata per litre, according to data available on Indian Oil Corporation website.

Diesel was retailing in Delhi at Rs 62.53 per litre, Mumbai Rs 65.43, Chennai Rs 66.01 and Kolkata Rs 64.30 a litre on Thursday.

Petrol price fell by nearly 16 percent in Delhi while benchmark Brent crude oil declined by about 30 percent in the past three months, said a report in Mint.

Petrol price hit record peaks of Rs 84 per litre in Delhi and Rs 91.34 in Mumbai on 4 October, 2018.

The fuel rate fell to the year’s low of Rs 68.84 and Rs 74.47 per litre in Delhi and Mumbai respectively on 31 December after the prices kept on falling due to the dip in crude price and a strong rupee.

Meanwhile, crude oil prices fell by more than 1 percent on Thursday on swelling US supply and amid caution after talks between the United States and China finished without any concrete details on a resolution to their trade disputes.

US West Texas Intermediate (WTI) crude oil futures were at $51.66 per barrel at, down 70 cents, or 1.3 percent, from their last settlement.

International Brent crude futures were down 1.2 percent, or 72 cents, at $60.72 per barrel.

Both oil benchmarks rose by around 5 percent on the previous day as financial global markets surged on hope that Washington and Beijing may soon be able to end their trade dispute, soothing fears of an all-out trade war between the two biggest economies and the risk of damage to global growth.

Some of the positive feeling ebbed on Thursday because of a lack of a details on the talks despite a warm statement from China on the outcome.

“The rally we have witnessed so far in 2019 is nothing to do with fundamentals, the rally is purely based on optimism and hope,” said Matt Stanley, a fuel broker with Starfuels in Dubai.

US bank Morgan Stanley cut its 2019 oil price forecasts by more than 10 percent on Wednesday, pointing to “weakening economic growth expectations” and rising oil supply, especially from the United States, as reasons for their lower price forecast.

Morgan Stanley now expects Brent to average $61 a barrel this year, down from a previous estimate of $69 a barrel, and US crude to average $54 per barrel, against a prior forecast of $60.

— With inputs from Reuters

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