India petrol, diesel prices see sharp cut due to global decline

Petrol and diesel prices recorded the biggest drop so far in this month on Friday. Oil marketing companies reduced the price of petrol by 21 to 22 paise, and that of diesel by 24 to 26 paise per litre.

Due to the steep fall in the price of crude oil in the international market, consumers in the country are constantly getting relief in the price of petrol and diesel. So far in this month, petrol has become cheaper by 59 paise per litre in Delhi, while in diesel prices, consumers have got 60 paise per litre relief.

According to the Indian Oil website, the price of petrol in Delhi, Kolkata, Mumbai and Chennai has come down to Rs72.68, Rs75.36, Rs78.34 and Rs75.51 per litre respectively.

At the same time, the price of diesel in the four metros has also come down to Rs65.68, Rs68.04, Rs68.84 and Rs69.73 per litre respectively.

Oil marketing companies cut petrol prices by 21 paise in Delhi, Kolkata and Mumbai on Friday and 22 paise per litre in Chennai. At the same time, the price of diesel has been cut by 24 paise in Delhi, 25 paise in Kolkata and Mumbai and 26 paise per litre in Chennai.

Due to the outbreak of coronavirus in China, there has been a steep decline in the crude oil prices in the international market in the last two weeks causing fears of slowdown in the economy there. Benchmark crude oil Brent crude has lost nearly $ 10 a barrel. However, on Friday, oil prices showed a slight increase compared to the previous session.

Brent crude’s April contract on the Intercontinental Exchange (ICE) was trading at $ 55.13 a barrel, up 0.36 per cent over the previous session. At the same time, US crude West Texas Intermediate’s March contract on the New York Mercantile Exchange (NYMEX) was trading at $ 51.09 a barrel, up 0.27 per cent from the previous session.

On Thursday, the Reserve Bank of India (RBI) kept rates steady and left the door open for more monetary easing, as it sought to support faltering economic growth and avoid stoking already heightened inflation levels.

The central bank has its work cut out as India’s economy is forecast to grow 5% in the year ending in March — its weakest pace in 11 years. A rapidly-spreading coronavirus outbreak in China has also cast a shadow over the global economy. “Downside risks to global growth have increased in the context of the outbreak of coronavirus, the full effects of which are still uncertain and unfolding,” RBI Governor Shaktikanta Das said at a press briefing following the decision.

Economists polled by Reuters had expected the RBI’s Monetary Policy Committee (MPC) to leave its key repo rate unchanged at 5.15% and reverse repo rate at 4.9%. All six members of the MPC voted to keep rates steady and retain the accommodative policy stance.

“The RBI’s decision is not surprising as the economy is showing classic signs of stagflation. Sharply higher inflation has come in the way of RBI playing the rate cut card, even as economic weakness persists,” said Kunal Kundu, India economist with Societe Generale.

Meanwhile, for the BJP-led Central government battling opposition criticism over a sluggish economy, the latest report of the Ipsos ‘What Worries the World’ monthly survey has good news as well as bad. 58 per cent of urban Indian respondents, in January, believed that India is heading in the right direction, unlike global citizens, of whom at least 61 per cent believe their country is on the wrong track.

However the bad news for the BJP is that the survey results for January show an 11 per cent drop in optimism levels from December, when no less than 69 per cent of urban Indians polled believed that India is moving in the right direction.

“Employment generation needs to be the top priority of the government, as it is reaching alarming proportions, among worry levels of urban Indians. Likewise, law & order and incidents of violence need to be tackled with a firm hand,” said Amit Adarkar, CEO, Ipsos India.

Urban Indians continue to list joblessness or unemployment, crime and violence, and financial and political corruption as their top concerns. In January, worries centred around financial and political corruption saw a slight dip of 2 per cent over the previous month, while concerns over joblessness, and crime and violence zoomed up by 11 per cent and 7 per cent, respectively.

“Urban Indians continue to be optimistic and have faith in the abilities of the administrators, steering the country. Government should allay their worries by taking concrete steps. Some of the initiatives announced in the Union Budget, around Education & Skills under ‘Aspirational India’ theme, are likely to a have a positive impact, in the long term. However, we need some immediate term measures, to improve outlook,” Adarkar added.

Agencies