US and Iran came to a peace agreement yesterday after months of war, that pushed commodity pries higher across the board on supply concerns. Ever since the US-Iran War had begun, fuel prices have been hiked for four times, with the latest increase of Rs 2.6 and Rs 2.7 per litre respectively announced last month. So far, prices have increased by Rs 7.5-8 since the start of the war.
With the war coming to a potential end, brent crude prices have also declined sharply. However, the prices of petrol and diesel have remain unchanged on Tuesday, June 16.
Oil manufacturing companies' (OMCs) under-recoveries have also seen a notable reduction, as per the latest data shared by the Ministry of Petroleum and Natural Gas on Monday. For petrol, the under-recoveries are down 83% to Rs 3 per litre from Rs 24 per litre on petrol, as on April 1. While diesel's under-recoveries saw a 75% reduction to Rs 27 per litre from Rs 105 per litre. State-owned oil firms had incurred losses Rs 1,600-1,700 crore per day, over Rs 1 lakh crore in 10 weeks amid the crisis.
In Delhi, petrol is priced at Rs 102.12 per litre, while diesel costs Rs 95.20 per litre on June 16.
Diesel prices on June 16
- Petrol price in Delhi : Rs 102.12/litre
- Petrol price in Kolkata : Rs 113.51/litre
- Petrol price in Mumbai : Rs 111.21/litre
- Petrol price in Chennai : Rs 108.01/litre
- Petrol price in Hyderabad: Rs 115.73/litre
- Petrol price in Bengaluru: Rs 110.89/litre
Diesel prices on June 16
- Diesel price in Delhi : Rs 95.20/litre
- Diesel price in Kolkata : Rs 99.82/litre
- Diesel price in Mumbai : Rs 97.83litre
- Diesel price in Chennai: Rs 99.66/litre
- Diesel price in Hyderabad : 103.82/litre
- Diesel price in Bengaluru: 98.80/litre
Global Crude Prices
Oil steadied on Tuesday after suffering its sharpest one-day decline in more than two weeks, as traders weighed the prospects of a US-Iran agreement that could reopen the Strait of Hormuz and restore a key artery of global energy trade.
Brent crude settled near $83 a barrel after dropping almost 5% in the previous session, while West Texas Intermediate (WTI) hovered above $81.
Markets are now focused on an interim agreement expected to be signed by Washington and Tehran in Switzerland later this week. While US President Donald Trump has expressed confidence that the Strait of Hormuz will reopen, traders remain cautious as neither side has yet released details of the proposed memorandum of understanding.
What Drives Petrol and Diesel Prices?
Fuel prices in India depend on several factors, with global crude oil prices being the most significant as crude is the primary raw material used to produce petrol and diesel.
The rupee–dollar exchange rate also influences fuel prices since India imports a large portion of its crude oil requirements.
Additionally, central excise duty and state-level value added tax or VAT significantly affect the final retail price of petrol and diesel. This is why fuel rates differ across all cities.
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