On Saturday, petrol prices touched an all-time high since 2013, then Sunday the prices surpassed that of Saturday while on Monday the prices of petrol and diesel created a new all-time record in Mumbai and Delhi by touching as high as Rs. 84.40 and Rs. 74.57.
As on May 24, petrol in Mumbai was retailing at Rs 85.29 per litre - the highest among all metros.
Other cities like Chennai and Kolkata are not insulated from the soaring fuel prices.
With petrol and diesel prices being hiked for the 10th day in a row, the government on Wednesday said it is working on a long-term solution to address the volatility and frequent revisions in rates. With petrol at over Rs 80 per litre - and rising, he was spending Rs 200 daily just to purchase petrol.
The domestic fuel prices are rising as the crude oil price in the worldwide market is endlessly rallying upwards.
At a press conference here on Thursday, chief spokesperson Sravan Dasoju alleged that the State government was taking advantage of Prime Minister Narender Modi's pro-oil firms policy by covertly imposing heavy taxes on petrol and diesel which today stands at 35.2% on petrol and 27% on diesel. It may be noted that this is the first time when petrol prices have gone up to such high rates in India.
Diesel prices across metros on May 23
The continuous increase in fuel prices would create a situation of inflation, which may trigger the Reserve Bank of India (RBI) to push key policy rates up by 25 BPS.
The worse is, however, yet to come since global oil prices are likely to rise further. "We have been given complete independence in this regard", Singh said. The Indian basket crude oil price was $77.04 a barrel on Tuesday.
The centre has held talks with the oil companies as part of controlling the price.
The government also does not want to lose revenue and is hoping for geopolitical tensions to ease and United States shale oil production to rise in order to ease oil prices. "Central government puts additional tax of Rs 10 on every litre of petrol". State sales tax or VAT varies from State to State.
Rising fuel prices are a major headache for the Modi government.
The UPA government finally freed petrol price in June 2010 and the diesel rates were decontrolled by the current BJP government in November 2014. Unlike excise duty, Value-Added Tax is ad valorem and results in higher revenues for the State when rates move up.
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