The Central levies on petrol and diesel were hiked by ₹ 3 a litre since Friday/Saturday midnight. After this hike, the central excise duty on petrol is at ₹ 22.98 a litre while the central duties on diesel is at ₹ 18.83 a litre.

Presently the central excise duty comprises of a Basic Excise Duty, Special Additional Excise Duty and Additional Excise Duty (Road and infrastructure Cess) on auto fuels.

But the price of petrol and diesel registered a decline on Saturday after oil companies further cut auto fuel prices in light of the substantial fall in global crude oil prices. Petrol sold at ₹69.87 a litre (down from ₹70 a litre) while diesel retailed at ₹62.58 a litre (down from ₹62.74 a litre) in the Delhi.

If the duty was not hiked, the cut in fuel prices would have been substantially higher as Brent crude has softened from about $66 a barrel in January 2020 to about $ 51 a barrel in the first week of March and since then fallen sharply to $32 a barrel this week. On Friday, Brent closed at $33.85 a barrel.

“This calibrated increase in duty rates would provide much needed resources for infrastructure and other developmental items of expenditure keeping in view the present fiscal position. While the benefit of reduction of crude prices in the first quarter of this year has significantly gone to the consumer, the government has taken this step of increasing duty to raise some revenue in view a tight fiscal situation,” an official in the know said.

“Even with this increase in the duties, the prices of petrol and diesel would fall further on account of significant fall in crude price. It may be noted that the prices of petrol and diesel have already fallen by more than ₹ 6 per litre since the second week of January,” the official added.

Revised price of auto fuel

Source: IndianOil