Petrol price cut by Rs1.51 per litre; diesel to cost 50 paise more

State-run oil marketing companies have announced a Rs1.51 per litre reduction in the retail price of petrol effective midnight tonight, making a third reduction in rates this month, even as the OMCs increased diesel prices by 50 paise per litre.

While petrol price was cut by Rs1.51 a litre, the actual reduction including local sales tax or VAT translated into a reduction of Rs1.82 a litre in Delhi, OMCs said.

Oil companies said the reduction was made possible due to a decline in international prices of crude oil.

Petrol in Delhi will cost Rs68.51 a litre from midnight tonight against Rs70.33 currently. In Mumbai petrol will now cost Rs76.41 per litre, while it will cost Rs76.14 per litre in Kolkata and Rs71.55 per litre in Chennai.

Diesel will cost Rs58.97 per litre in Delhi compared to Rs58.40 currently. Rates will vary from city to city depending on local sales tax or VAT.

The hike in diesel prices by 50 paise per month will continue till retail rates come on par with its cost, in line with the government's January 2013 decision.

Petrol price was cut by 90 paise (Rs1.09 a litre after including local sales tax) on 1 August and again by Rs1.81 (Rs2.18 per litre, after including VAT) on 15 August.

At Rs68.51, petrol price is lowest since June last year when it was sold Rs68.58 per litre.

Indian Oil corp, the nation's largest fuel retailer, said the downward trend in international prices has also allowed for a reduction in the price of non-subsidised cooking gas (LPG) by Rs19 per 14.2-kg cylinder. None-subsidised LPG is the one that household consumers buy after exhausting their quota of 12 bottles in a year.

Subidised cylinder costs Rs414 per litre in Delhi. A 14.2-kg non-subsided LPG cylinder will cost Rs901 from tomorrow as compared to Rs920 currently.

Also, the rates for bulk diesel, which is priced at market rates, was cut by Rs1.32 per litre in Delhi. As per government policy, bulk users like railways, defence and state road transport corporations buy diesel at market price, which is higher than pump rates.