Rising of fuel price
By Sandeep Nagyaan · 10 Sep 2018
Rising of fuel price:- Petrol prices on Sunday rose by Rs 0.12 per litre in both New Delhi and Mumbai for the fourth consecutive day. While petrol is retailing at Rs 80.50 per litre in the national capital, it is being sold at Rs 87.89 per litre in Mumbai.To protest against the increase of fuel prices, opposition parties have called for a ‘Bharat Bandh’ on Monday. The prices of petrol and diesel in Indian cities have risen to their highest level since late 2013. Since mid-August, petrol price has risen by Rs 3.24 a litre and diesel by Rs 3.74 per litre as rupee hit a record low against the US dollar, making imports costlier. This is the biggest increase in rates in any fortnight since the daily price revision was introduced in mid-June last year
How does it happen:- There is no strict rule that lower international crude oil prices must lead domestic fuel prices. When the price of crude oil is high oil companies are forced to cut down on their supply to their market in order to drive up the prices to competitive levels. High taxes are another factors that can discourage producers from bringing enough supply to retail market, leading to higher prices.
Other causes to help rise of fuel price:- (1)The supply cut by the Organization of the Petroleum Exporting Countries (Opec) group. (2) Economic sanctions of Iran by America, because India also import large amount of crude oil from Iran. (3) The burden of value added tax (VAT) by each state is one of main factor to hike the fuel price. (4) The high rate of dollar is helping to increase the fuel price in India.