Immediate Price Adjustments for Petrol and Diesel
Nayara Energy, identified as India's largest private fuel retailer, has increased fuel prices with immediate effect. The company raised petrol prices by ₹5 per litre and diesel prices by ₹3 per litre.
The price increase was announced to take effect from the early hours of Saturday. This adjustment comes as pressure continues to mount on fuel retailers due to higher global energy prices.
Geopolitical Disruptions Drive Cost Increases
The latest revision in pricing occurs against the backdrop of a US-Iran war that broke out in late February. The conflict has disrupted energy supplies and added pressure on fuel retailers facing higher crude oil and fuel costs.
Nayara Energy became the first retailer to pass these higher international oil prices to consumers following the outbreak of the war. This price hike marks another revision for Nayara Energy this year as Indian refiners deal with geopolitical disruptions impacting global crude oil and fuel markets.
Historical Pricing Revisions
In March, Nayara Energy had previously raised petrol and diesel prices by ₹5 and ₹3 per litre respectively. That earlier increase brought rates to ₹100.71 per litre for petrol and ₹91.31 per litre for diesel.
However, the company later reversed that March price hike on July 1. At that time, Nayara Energy slashed petrol prices by ₹5 and diesel by ₹3 a litre after global crude prices eased as tensions in West Asia subsided.
State-Owned Retailers Follow Suit
Following Nayara Energy's initial moves, state-owned fuel retailers began transferring higher international oil price impacts to consumers in May. Cumulative hikes by these entities reached around ₹7.50 per litre for both fuels by the end of May.
The fourth increase by state-owned oil marketing companies was announced on May 25. This specific revision included a hike of ₹2.61 per litre for petrol and ₹2.71 per litre for diesel.
State-owned entities, including Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation, hold over 90 per cent of India's 1,04,137 petrol pumps. Historically, these companies have kept prices relatively stable despite global crude fluctuations.
Supply Constraints and Regulatory Response
The latest price hike occurs against the backdrop of a US-Iran war that has disrupted global energy supplies and added pressure on fuel retailers facing higher crude oil and fuel costs. Amid these financial pressures, Nayara Energy and Jio-BP limited supplies at some pumps due to losses on retail fuel sales.
Officials stated that the price difference between retail and bulk diesel led industrial consumers to purchase cheaper fuel from retail outlets, putting additional pressure on supplies. In response to these supply limitations, the Centre asked private fuel retailers not to limit petrol and diesel sales.