OMCs raise fuel prices again, petrol at ₹104.61/litre in Delhi

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NEW DELHI: Oil marketing companies raised fuel prices by another 80 paise on Tuesday, pushing up the price of petrol to 104.61 per litre in the national capital. Diesel prices were also hiked by 80 paise a litre to 95.87 a litre in the city, according to data from Indian Oil Corp.

With this, petrol and diesel prices have gone up a cumulative 9.20 a litre each in the past 15 days. Before 22 March, oil marketing companies had kept prices steady for nearly four months.

Hikes are expected in the near term to make up for the gap between global crude oil prices and domestic retail rates. In a recent report, Moody’s Investor Services said price control measures will weaken earnings or cash flow of refining and marketing companies in India.

“Indian refining and marketing companies will have to absorb a proportion of the higher feedstock costs until the time that their net realization prices are in line with market prices,” it said.

On Tuesday, oil futures rose in early deals as possibilities of more sanctions following alleged war crimes by Russian troops in Ukraine added to concerns about supply disruptions, while Iran nuclear talks stalled.

At 10am, the June contract of Brent futures on the Intercontinental Exchange was at $108.68 per barrel, up 1.07% from previous close. The May contract of West Texas Intermediate on the NYMEX rose 1.14% to $104.46 per barrel.

Supply concerns had somewhat eased after the members of the International Energy Agency (IEA) in a meeting on Friday decided to join the US in releasing more stocks from their emergency reserves amid the continuing Russia-Ukraine conflict.

“The International Energy Agency’s 31 member countries agreed on Friday to a new release of oil from emergency reserves in response to the market turmoil caused by Russia’s invasion of Ukraine, underscoring their strong and unified commitment to stabilizing global energy markets,” IEA said in a statement. The agreement follows the previous action taken by IEA Member Countries, announced last month, to which they pledged a total of 62.7 million barrels.

Further, the two-month long truce between the Saudi Arabia-led coalition and the Houthi rebels in Yemen brokered by the United Nations has also raised hopes of increase in supplies. Saudi oil facilities have been under attack by the Houthis during the conflict, adding to supply disruption in the global market.

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