The state refiners could cut petrol prices by about one rupee a litre or 1.5 percent as softening Singapore blemish gasoline prices have offset the impact of a waning rupee, an industry source has revealed on Monday.
The companies cut petrol prices by about 3.2 percent earlier this month, the first reduction in retail prices in nearly three years and the first since prices were decontrolled in June 2010.
“As per current calculations, there is scope to cut the basic price of petrol by about 0.85 rupees a litre, counting taxes it should be about one rupee. We have to see price movements in the next two days also before deciding the final impact,” the official has told on condition of obscurity.
Refiners converse prices every two weeks and so far in this fortnight, spot FOB gasoline prices in Singapore have averaged $108.76 a barrel evaluate with $114.13 in the previous fortnight, according to Reuters calculations.
Oil companies had earlier this month cut gasoline prices taking into consideration the rupee average at 49.30 to a dollar, an Indian Oil Corp press discharge said. Since then, Reuter’s data shows the rupee has declined to an average 51.78.
India’s three state fuel retailing giants, IOC, Hindustan Petroleum Corp and Bharat Petroleum Corp tend to move their prices in tandem. Gasoline is nowhere near as extensively used as diesel in India– accounting for around 10 percent of fuel demand compared with about 40 percent for diesel — but it has a high-profile because it powers many of the cars owned by the growing middle class.
Gasoline has a 1.09 percent weighting in the inflation index and near double-digit consumer prices have aggravated criticism of the government, which subsidizes other fuels such as diesel and cooking gas. The widening price gap between gasoline and diesel has slowed the expansion of gasoline expenditure, which has recently fallen behind that of diesel.
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