Prices, diesel prices slashed by up to 10 paise for first time in a month as crude oil steadies; here's rate in four metros

This was for the first time since 8 September, petrol and diesel prices were cut after a fall in the crude oil rates in the international market.

Published: Oct 3, 2019
Prices, diesel prices slashed by up to 10 paise for first time in a month as crude oil steadies; here's rate in four metros Image: Shutterstock

Petrol and diesel prices were slashed for the first time in a month by 10 paise and 7 paise respectively in major cities across the country on Thursday even as crude oil futures rebounded reversing losses earlier in the day over fears of a worsening global economic outlook.

This price cut is the first since 8 September.

On 16 September, crude oil prices surged the most on record with Brent crude rising 19.5 percent to $71.95 per barrel-the biggest gain in dollar terms since futures started trading in 1988. In the last fortnight, however, the crude prices declined to $57.79 a barrel after the supply improved post-drone attacks.

Petrol price had touched its peak of Rs 80.21 in Mumbai on 1 October as the rates continued to rise for a fortnight after the drone strikes on Saudi Arabian oil facilities on 14 September

In Delhi, petrol was selling at Rs 74.51 per litre on Thursday after the price cut, Mumbai Rs 80.11, Kolkata Rs 77.14 and Chennai Rs 77.40 a litre, according to data available on Indian Oil Corporation (IOC) website. Diesel was retailing in Delhi at Rs 67.43 per litre, Mumbai Rs 70.69, Kolkata Rs 69.79 and Chennai Rs 71.24 a litre after the rate reduction.

On Wednesday, the fuel prices remained unchanged across the country. Accordingly, in Delhi, petrol was retailing at Rs 74.61 per litre on Tuesday, Mumbai Rs 80.21, Chennai Rs 77.50 and Kolkata Rs 77.23 per litre. Diesel was selling in Delhi at Rs 67.49 a litre, Mumbai Rs 70.76, Chennai Rs 71.30 and Kolkata Rs 69.85 per litre.

There was a report that petrol and diesel prices could fall in the coming days by at least Rs 1.50 per litre as a result of the dip in crude oil price. Brent futures are now well-below levels seen before the September attacks on Saudi Arabia oil facilities that briefly halved more than half the kingdom's output.

Meanwhile, crude oil futures rebounded on Thursday, reversing losses earlier in the day, as fears over the worsening global economic outlook that hit prices hard in the previous session gave way to modest hopes for progress in resolving the US-China trade war, reported Reuters.

Brent crude oil futures edged 10 cents higher, or 0.2 percent, to $57.79 a barrel, after tumbling 2 percent in the previous session.

US West Texas Intermediate (WTI) crude futures were up 23 cents, or 0.4 percent, to $52.87 a barrel, after sinking by 1.8 percent on Wednesday.

"What's impossible to ignore is the economic realities being signalled in the latest run of doom and gloom financial market data which offers few if any reason for oil investors to be optimistic over the outlook for global demand," said Stephen Innes, market strategist, SPI Asset Management.

World equity benchmarks hit their lowest levels in a month on Wednesday as signs of a slowdown in US economic growth and weak earnings in Europe fanned fears the global economy could slip into recession.

Still, Wednesday's slide to near two-month oil price lows proved an attractive enough buying opportunity for some.

"While the near-term triggers may continue to relate to oil demand, next week US-China trade talks remain the unknown variable which could lend a modicum of support," said Innes.

Also hurting sentiment in the previous session was US crude inventories rising 3.1 million barrels last week, according to the country's Energy Information Administration, far exceeding analyst expectations for an increase of 1.6 million barrels.

"The market is clearly fixated on the potential impact of weak economic growth on oil demand, with supply side issues taking a back seat for the moment," said ANZ.

- With agencies inputs

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