Amid growing indications of a potential price hike, now might be a strategic time to fill up on fuel. Petrol and diesel prices are anticipated to rise following the announcement of the 2024 Lok Sabha election results on Tuesday. In March, oil marketing companies, in coordination with the petroleum ministry, had reduced prices by ₹2 per litre. This reduction, effective from March 15, was praised by BJP leaders as a welfare measure by Prime Minister Narendra Modi, while critics viewed it as a tactic to gain voter favor during election season.
With the election results imminent, there is a strong possibility that the previous price cuts might be reversed. Should petrol and diesel prices increase, it may not happen immediately, but signs strongly suggest an eventual rise. Recent global events have contributed to this outlook. Crude oil prices have surged to a four-year high due to ongoing tensions in West Asia and the extension of voluntary output cuts by OPEC+ countries. According to Reuters, OPEC+ decided in a recent Sunday meeting to extend these cuts well into 2025 to support global oil prices.
Domestically, fuel station owners have been under pressure since the March 15 price cut, as they have had to sell existing stock at the new, lower prices. An upward revision in prices would alleviate these pressures and provide relief to oil marketing companies.
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Fuel prices in India are influenced by a variety of factors beyond global rates, including numerous taxes and cess imposed by both central and state governments. Fuel remains a significant source of revenue for governments across the country, making price adjustments a complex and multifaceted issue.