India's Crude Oil import bill rose by 35% to $10.34 billion in the month of December alone with fuel prices reaching record levels in January.
India’s cumulative Crude Oil bill in the first nine months of the current financial year increased by 24.18 per cent to $76.14 billion as compared to $61.31 billion in the corresponding period last fiscal, according to latest data from the Petroleum Planning and Analysis Cell (PPAC).
PPAC, the statistical arm of Oil ministry has estimated the country’s crude oil import bill to increase by 15 per cent to $81 billion for the full financial year ending March 2018. Every Dollar increase in crude oil price increases the country’s net import bill by $0.51 billion.
The surge in global crude oil prices, besides widening the country’s trade deficit, has also had an inflationary impact on the economy with fuel prices reaching record highs and consumer price inflation (CPI) index reaching a 17-month high at 5.21 per cent in December.
Diesel prices in Delhi, Kolkata and Chennai reached an all-time-high at Rs 61.88, Rs 64.54, Rs 65.23 per litre respectively on 16 January. Diesel prices in Mumbai have reached Rs 65.90 per litre, a price high last seen in 2014.
Similarly, petrol prices in Delhi, Kolkata, Mumbai and Chennai on 16 Jan were at Rs 71.27, Rs 74, Rs 79.15, Rs 73.89 per litre respectively -- prices last seen in 2014 when the global crude oil price of Indian basket was around $100 per barrel.
Brent crude prices on Tuesday opened at a three-year high of $70 per barrel. While India’s fuel prices are not directly linked to global prices of crude oil -- prices of petrol and diesel in India are the average of the trailing 15 days of benchmarked Arab-Gulf fuel prices which move in tandem with global crude oil prices.
However, the prices of petrol and diesel in India have witnessed a steady increase in the past three years as the government has increased excise duty on the two fuels 12 times since 2014. Excise duty on petrol has been hiked by 54 percent since Nov 2014 (excluding excise cut in October 2017) and on Diesel by 154 percent, leading to rise in fuel prices despite crude prices considerably lower compared to 2014 level.
Source: Commodity OnlinePrevious Next
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