Fuel price cut relief may come soon as global oil softens

Consumers bearing the brunt of rising fuel prices for more than a couple of months may expect some relief over the next few days as Oil marketing companies (OMC) have begun evaluating the fall in global oil prices and its resultant impact on fuel prices in the country.

The benchmark Brent crude that had risen to $77 a barrel late last month has shed more than 10 per cent in the last fortnight to reach a level of $68.85 a barrel now. If the price line remains below $70 a barrel for a few more days, petrol and diesel prices could see a cut in the coming days.

Already the impact of softening of prices in the oil market is being seen in the fuel price movement in the country. On Wednesday, the OMCs kept the retail price of petrol and diesel unchanged. This is the fourth consecutive day, the longest period in weeks, when fuel prices have remained steady.

With Wednesday's pause, petrol continues to be sold for Rs 101.84 per litre, while diesel is also being sold at the unchanged price of Rs 89.87 a litre.

The pump price of fuel has been static since Sunday. It rose on Saturday with petrol being revised upwards by 30 paise per litre while diesel price remained unchanged.

In the city of Mumbai, where petrol price crossed the Rs 100-mark for the first time ever on May 29, the fuel price is at Rs 107.83 per litre. Diesel price in the city is also at Rs 97.45, the highest among metros.

Petrol price in all metros have now crossed Rs 100 per litre-mark. But they have remained static the past four days.

Under daily price revision, OMCs revise petrol and diesel prices every morning, benchmarking retail fuel prices to a 15-day rolling average of global refined products' prices and dollar exchange rate. Once this 15 day cycle returns, petrol and diesel prices may fall.