Due to rising crude oil prices, petrol prices may increase by up to ₹18 per liter and diesel prices by up to ₹35 per litre. According to a report by Macquarie, a foreign brokerage firm, despite the huge jump in the cost of crude oil, petrol and diesel prices within the country have remained stable. As a result, oil companies are incurring losses. As a result, these companies may increase prices after the elections are over in five states, including West Bengal.
Crude oil prices rise by $27 in 46 days
date | price of crude oil
27th February $73 per barrel
19 March $120 per barrel
14th April $100 per barrel
Companies suffer loss of ₹1,600 crore per day
Due to the high cost of crude oil, companies are currently making a loss of ₹18 per liter on petrol and ₹35 per liter on diesel. When prices were at their peak last month, these three companies combined were losing about ₹2,400 crore per day. After ₹10 cut in excise duty, this daily loss has come down to ₹1,600 crore. For every $10 increase in crude oil prices, the loss increases by about ₹6 per litre.
India imports 88% of its crude oil needs
India imports about 88% of its crude oil needs. Of this, 45% comes from the Middle East and 35% from Russia. Rising crude oil prices pose a threat not only to oil companies but also to the country’s current account deficit (CAD). It is estimated that by the first quarter of 2026, this deficit could increase to $20 billion.
pressure on government revenue
The contribution of excise duty on fuel to government revenue is continuously decreasing. In FY 2017, this contribution was 22%, but now it has come down to just 8%. Even if the government waives off excise duty completely, the losses incurred by oil companies at current price levels will not be completely eliminated.
Many countries including America increased the prices of petrol and diesel.
In the US, average gasoline prices have reached above $4 per gallon for the first time since August 2022. At the same time, many neighboring countries including Pakistan, Nepal and Sri Lanka have also increased the prices of petrol and diesel.