Diesel price down 8p today; Mumbai, Chennai sees record cut for 8th day in row

For the Indian government, fuel is a major generator of revenue and that is why authorities have been reluctant to provide relief to consumers.

Unlike petrol price, the state-owned OMCs reduced diesel price at much lower rate by 8 paisa each per litre in various state capitals of India. In the past, diesel prices were stuck in the range of Rs 50 to Rs 60 per litre, but with the start of 2018, there is no stopping the rate hike in this crucial product, which still remains at record high. The rise was an outcome of higher crude oil prices and no relief in excise duty and Value Added Tax (VAT) which left no room for OMCs. Oil Ministry is likely to ask ONGC to bear subsidy burden instead of OMCs to bring relief in fuel price.

For the Indian government, fuel is a major generator of revenue and that is why authorities have been reluctant to provide relief.

Today, diesel price in New Delhi was down to Rs 68.80 per litre, after a cut in rates by 8 paise, compared to previous day's price of Rs 68.88 per litre.

Similarly, diesel price in Kolkata was ruling at Rs 71.35 per litre today, which was down 8 paise against previous day's price of Rs 71.43 per litre. This city has clocked over Rs 72 per litre rate after Mumbai and Chennai respectively. However, Mumbai and Chennai saw the biggest cut in diesel prices today.

India's financial hub Mumbai saw a cut of 8 paise in diesel price and is now selling at new price of Rs 73.25 per litre as against Rs 73.33 per litre of previous day.

In Chennai, the price was also below 8 paise and available at Rs 72.64 per litre on Tuesday, compared to previous price of Rs 72.72 per litre.

Moreover, brent crude reversed losses on Tuesday, after hitting its lowest price in nearly a month following a report the U.S. government asked Saudi Arabia and other major exporters to increase oil output.

As per Reuters, brent crude futures rose 9 cents to settle at $75.38 a barrel, a 0.12 percent gain. It touched a low of $73.81, its lowest since May 8. U.S. West Texas Intermediate (WTI) crude futures rose 77 cents to settle at $65.52 a barrel, a 1.2 percent gain. Earlier, WTI hit a session low of $64.22, the lowest since April 10.

From May 14 till today, diesel prices rose by Rs 2.95 per litre each in New Delhi and Rs 2.80 per litre in Kolkata. Whereas, Mumbai and Chennai saw the most hikes - as much as Rs 3.13 per litre and Rs 3.16 per litre respectively.