Published On : Wed, Aug 16th, 2017

Oil companies making a hole in customers’ pockets with hike in fuel prices, slyly

Have you, the customers, know that “pickpockets” have descended on the market and robbing you slyly? The pickpockets are none other than the petroleum companies. Many of the customers are unaware of the burden the petroleum companies have put on their pockets by increasing the fuel prices in the past one and half month. These companies have hiked the prices of petrol and diesel by Rs 5 in recent times but the customers are in the dark about this development! Interestingly, when the companies hiked fuel prices by Rs 2 or 3 it triggered uproar but the hike of Rs 5 went unnoticed as there is no dissenting word at all.

The petroleum companies have increased fuel prices by 12 percent in the past one month as the Central Government has given green signal to these companies to put in place a mechanism under which fuel prices will be aligned to international crude oil prices on a daily basis. But there is no opposition to this step of Modi Government nor lengthy debate at any forum.

The petroleum companies had announced determination of fuel prices on daily basis from June 16. In the first month, the fuel prices witnessed downfall of few paisas. This lowering of prices saw customers happy. But it was short lived benefit. In the next month (July 15 to August 15), petrol and diesel prices saw a steep hike.

On August 15, petrol price after revision stood at Rs 78 in Nagpur which was Rs 73 on June 25. It simply means there was hike of Rs 5 in petrol price in Nagpur alone. Same is the case of diesel price.

The government deregulated petrol price in 2010 and diesel price in 2014. It, henceforth, allowed oil marketing companies — Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp — to decide on the prices of fuel, considering the change in international oil prices and currency exchange rate. But the decision to change fuel prices everyday invited less interference from political parties to address their interests. Even if they would interfere with the price change, they will not be able to defer the decision for long due to the urgency to revise prices daily. Prices at petrol pumps may change every day, similar to what happens in many advanced markets, as state oil companies plan to review rates daily to align them with international prices, replacing the current practice of fortnightly revision.