Good News! Petrol, diesel prices to come down soon, know why?

Petrol and diesel prices are skyrocketing in the country. Although there has been a fall in the prices of oil in the last few days, still these prices are troubling the common man. At present, there is a steady decline in the prices of crude oil in the international market and soon its effect can be seen on India as well which means that petrol and diesel prices in India may come down further.

At present crude oil (Brent crude) has come down to $80. It was below $80 at the beginning of October, after which it saw a boom and reached close to $86 at the end of October. Petrol and diesel prices may come down due to a reduction in crude oil prices.

According to a news agency Reuters, OPEC Plus countries have talked about increasing crude oil production in the coming weeks. It is expected that in the coming days, production will be increased by 20 lakh barrels a day. With this, the price of crude oil falls to $75 in the coming days.

Due to the increase in production, there will be a decrease in demand and it will likely lead to a fall in the prices of crude oil, whose effect can also be seen in the Indian market.

As per experts, if petroleum companies pass on the benefit of falling crude oil prices to the general public, the prices of petrol and diesel can be reduced by 2 to 3 rupees per litre. However, if the rupee weakens against the dollar in the coming days, it may be difficult for petrol and diesel to become cheaper.

Petrol or diesel prices mainly depend on 4 factors – Crude oil price, US dollar price against the rupee, Tax to be collected by the Central and State Governments, and fuel demand in the country.

India buys more than 85% of its crude oil from outside. The price of this crude oil is paid in dollars. In such a situation, due to the increase in the price of crude oil and the strengthening of the dollar, petrol and diesel start becoming expensive. Crude oil comes in barrels. One barrel means 159 litres of crude oil.

In order to give relief to the people from the rising prices of petrol and diesel, the central government on November 3 had reduced the excise duty on petrol by Rs 5 and diesel by Rs 10. This reduction is followed by Karnataka, Puducherry, Mizoram, Arunachal Pradesh, Manipur, Nagaland, Tripura, Assam, Sikkim, Bihar, Madhya Pradesh, Goa, Gujarat, Dadra and Nagar Haveli, Daman and Diu, Chandigarh, Haryana, Himachal Pradesh, Jammu and Kashmir, Uttarakhand, Uttar Pradesh and Ladakh, that also slashed the VAT. The common man has got some relief from this joint decision of the central and state governments.