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In a first, diesel costlier than petrol in Delhi after 18 hikes in a row

According to a price notification of state oil marketing companies, petrol price was unchanged after 17 consecutive increases, while diesel rates were increased by 48 paise per litre across the country.

PTI | New Delhi |

Diesel price for the first time in living memory crossed the rate of petrol in the national capital on Wednesday when prices were raised for a record 18th day in a row.

According to a price notification of state oil marketing companies, petrol price was unchanged after 17 consecutive increases, while diesel rates were increased by 48 paise per litre across the country.

Diesel now costs Rs 79.88 per litre in Delhi as compared to petrol price of Rs 79.76 a litre.

Rates differ from state to state depending on the incidence of VAT. However, diesel is costlier than petrol only in the national capital where the state government had raised local sales tax or VAT on the fuel sharply last month.

Petrol costs Rs 86.54 a litre in Mumbai and diesel is priced at Rs 78.22. In Chennai, a litre of petrol comes for Rs 83.04 and diesel for Rs 77.17. In Kolkata, petrol is priced at Rs 81.45 per litre and diesel costs Rs 75.06. In Bengaluru, petrol comes for Rs 82.35 a litre and diesel for Rs 75.96. In Hyderabad, petrol is priced at Rs 82.79 a litre and diesel at Rs 78.06.

Traditionally, diesel was priced Rs 18-20 a litre lower than petrol due to lesser taxation. But over the years, the taxes have increased, narrowing the gap.

The Delhi government had on May 5, hiked Value Added Tax (VAT) on diesel from 16.75 per cent to 30 per cent and on petrol from 27 per cent to 30 per cent. Since the levy is ad valorem, the actual incidence has gone up every single time oil companies raised retail selling price in the last 18 day.

The 18th daily increase in rates since oil companies on June 7 restarted revising prices in line with costs after ending an 82-day hiatus in rate revision, has taken diesel prices to fresh highs. In 18 days, diesel price has gone up by Rs. 10.49 per litre. Petrol price had risen in the past 17 days by Rs. 8.5 a litre.

Prior to the current rally, the peak diesel rates had touched was on October 16, 2018, when prices had climbed to Rs. 75.69 per litre in Delhi. The highest ever petrol price was on October 4, 2018, when rates soared to Rs. 84 a litre in Delhi.

Oil PSUs Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) instead of passing on the excise duty hikes to customers adjusted them against the fall in the retail rates that was warranted because of fall in international oil prices to two-decade low.

International oil prices have since rebounded and oil firms are now adjusting retail rates in line with them.