New Delhi, 2/3: After remaining stable for months, petrol and diesel prices may see a hike after assembly elections come to an end next week, says a JP Morgan report
Fuel prices may be hiked to bridge the ₹ 9 a litre gap created by surging international crude prices, which have gone past the $100 per barrel.
“With state elections getting over next week, we expect daily fuel price hikes to restart across both gasoline and diesel,” JP Morgan said in a report.
The seventh and final phase of polling for the Uttar Pradesh assembly elections is to be held on March 7 and the counting of votes for all the elections held earlier in Uttarakhand, Punjab, Goa and Manipur is slated to take place on March 10.
International crude oil prices shot above $110 a barrel for the first time since mid-2014 on fears that oil and gas supplies from energy giant Russia could be disrupted, either by the conflict in Ukraine or retaliatory western sanctions.
The basket of crude oil India buys, rose above $102 per barrel on March 1, the highest since August 2014, according to information from the Petroleum Planning and Analysis Cell (PPAC) of the petroleum ministry. This compares to an average of $81.5 per barrel price of the Indian basket of crude oil at the time of freezing of petrol and diesel prices in early November last year.
State-owned fuel retailers Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) are making a loss of ₹ 5.7 a litre on petrol and diesel. This is without taking into account their normal margin of ₹ 2.5 per litre.