International price rise of crude has led to the increase in the oil price in India also, with diesel priced at a record high of Rs. 61.74 per liter and petrol over Rs. 71 in many cities.
The price of petrol in the nation’s capital went up to Rs. 71.18 per liter on Monday, the highest in about three and a half years as stated on a price list of the government-owned oil firms. Diesel in Delhi also rose to its highest price of Rs. 61.74. Notably, it is being sold at Rs.65.74 in Mumbai due to higher VAT in the state.
The prices of both commodities have been rising steadily since December 12, 2017, when diesel was priced at Rs. 58.34 and petrol at Rs. 69.09, as stated by oil companies.
The two most traded crude internationally, Brent and WTI, are also at the highest levels since December 2014 with their prices reaching $70.05 and $64.77 respectively. The increase in prices has revived the need for the government to reduce the custom duty on the commodity and buffer the effect of the rise on the average citizen.
The current government led by the BJP has only reduced the custom duty once during its reigning period of over three years by Rs. 2 when the nation’s capital had petrol selling at Rs. 70.88 per liter and diesel selling at Rs. 59.14. This was done in October of last year.
However, the following increase in prices has led to all profits vanishing and the prices have reached record highs.
The Union Oil Minister responded to demands of decrease in VAT by saying that these demands should be made in front of the state government and they are the ones who should be asked to reduced VAT.
The price of both commodities is the lowest in among all the metro cities and the Finance Minister has asked the state governments to reduce VAT as the reduction in customs is already leading to loss in government revenue.