Consumers can cheer as oil marketing companies (OMC) may actually bring down the retail prices of petrol and diesel in the coming week ahead of Diwali.
Oil sector experts said that with global oil prices under pressure from slowing demand in the second wave of Covid-19 pandemic sweeping several western countries, crude price could fall in coming days. If this holds on for a week or so, there could be positive gains for auto fuel consumers in India by way of a fall in retail price of petrol and diesel.
Global crude prices are already down over 5 per cent over the week with oil now selling close to $40 a barrel from earlier levels of over $ 42 per barrel. But with lower oil demand and rising inventory, there is fear among oil producing companies that crude prices may start falling again.
OMCs in India have been holding on to the retail price of petrol and diesel for close to a month now. Even on Tuesday, the price of two petrol products remained unchanged. With this, petrol prices have now been unchanged for over a month now while diesel prices were same for the 25th straight day across the metros.
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Price of petrol in the national capital was at Rs 81.06 per litre. In Mumbai, Chennai and Kolkata, the fuel was sold for Rs 87.74, Rs 84.14 and Rs 82.59 per litre, respectively.
Diesel prices in Delhi, Mumbai, Chennai and Kolkata were at Rs 70.46, Rs 76.86, Rs 75.95 and Rs 73.99, respectively.
But with fresh indications on global oil prices, domestic oil companies could revise the retail price downwards. However, their margins would be protected as oil demand in the country had picked up latterly getting over even the last years numbers.
Retail sales have picked up with the gradual reopening of the economic activities. First time since lockdown, diesel sale in the country has crossed over the pre-covid level with the country's most widely consumed fuel witnessing a nine per cent year-on-year growth in the first 15 days of October.
The surge in demand after months of subdued sales is the direct result of an increase in the transport activities ahead of the festival season as consumers move out to make those necessary purchases.