It's July 2, and the new month has started off a decent note with geopolitical tensions between the US and Iran easing substantially, crude prices back to pre-war levels, and restrictions on sale of petrol and diesel to commercial players have been lifted.
With the four-month US-Iran war, that threatened to resume the past weekend, coming to a potential end, all eyes are on whether the retail fuel prices will see a cut. However, the prices of petrol and diesel have remain unchanged on Thursday, July 2.
Nayara Energy cut petrol prices by Rs 5 per litre and diesel by Rs 3 a litre across its nationwide network on Wednesday July 1, marking the first reduction in retail fuel prices by any company in more than two years as easing tensions in West Asia pulled down international oil prices.
However, state-run oil marketing companies (OMCs) are unlikely to immediately match Nayara Energy's sharp cuts in petrol and diesel prices despite softer global crude prices, as they continue to recover losses incurred during the recent West Asia conflict, sources told NDTV Profit.
Ever since the US-Iran War began, 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.
In Delhi, petrol is priced at Rs 102.12 per litre, while diesel costs Rs 95.20 per litre on July 2.
Petrol prices on July 2
- 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 July 2
- 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 prices fell for a third straight session on Thursday as crude shipments through the Strait of Hormuz continued to recover and investors remained optimistic that indirect negotiations between the US and Iran could reduce the risk of further supply disruptions.
Brent crude for September delivery traded near $71 a barrel, extending losses after falling more than 3% over the previous two sessions. West Texas Intermediate (WTI) hovered around $68 a barrel.
Market sentiment improved after a US official said oil flows through the Strait of Hormuz had climbed to more than 10 million barrels a day, signalling that global energy supplies are steadily returning. The recovery has eased concerns that Iran could significantly disrupt shipping through the strategic waterway, which carries roughly a fifth of the world's seaborne crude.
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.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.