Oil prices increases for the 20th consecutive day; Diesel more expensive than Petrol in national capital

Protests are going on all over the country in light of the increasing oil prices. Opposition parties are rallying support from the public. Priyanka Gandhi even went to criticise the ruling government for pick-pocketing from the society even in times of crisis. There is a cycle march going in Patna; people are urging Prime Minister Narender Modi to control the hike in prices. During the lockdown, because of lesser demand in crude oil all over the world for one day in the USA, the oil prices plummeted below zero. The difference between crude oil and petroleum, which is a refined product became negative. Whereas in India, the prices were skyrocketing.

In Delhi, for the first time, the price of a litre of diesel was more than petrol. For many years the general public was purchasing diesel cars because of the comparative price difference in Petrol and Diesel, but it has changed over the years. In Delhi, a litre of diesel costs Rs 80.19 while petrol costs Rs 80.13 a litre. Since lockdown was lifted, the price of oil has increased every day; and has been so for the past 20 days. Indian Oil Corp responded to the public by saying that the increase in the process is because of the Delhi government, which has increased the value-added tax on oil.

The VAT on Petrol has been increased from 27% to 30% while diesel has been increased from 16.75 % to 30%. The cost of petrol has been raised by Rs 8.87 and Rs 10.8 respectively over the past twenty days. This is a significant increase that has never been seen in India, even during the UPA government when inflation was increasing; such a price jump has never been observed. It has raised an alarming issue for the Central government to deal with.

State oil firms benchmark retail rates to Arab-Gulf international, and according to an algorithm, a formula decides the price of the oil in the state calculating the VAT added by each state government. Though there has always been a difference in rates of diesel and petrol due to increasing taxes, it has come much closer but only in the capital is the cost of diesel more than petrol.

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