Following the steep decline oil prices by 5% globally, Indian oil companies have cut prices by 1% in petrol and diesel but a day after, the price of non-subsidised cooking gas (LPG) was also cut by a hefty Rs.113 per cylinder and of aviation turbine fuel (ATF) or jet fuel by over 4 percent.
The 14.2 kg cylinder of non-subsidized LPG is now available at Rs.752 in Delhi as compared Rs.865 previously, state-run oil marketers announced on Monday. Non-subsidised LPG is given to commercial establishments without subsidy and those after exhausting their quota of 12 cylinders per month.
The price of jet fuel at Delhi was cut by 4.1 percent, or Rs.2,594.93 per kilolitre, and now stands at Rs.59,943 a kl. In November, ATF rate was cut by a steep 7.3 percent or Rs.4,987.7 per kl.
Petrol and diesel prices have also been reduced with effect from Monday by 91 paise and 84 paise respectively. “The prices of petrol and diesel were last revised downwards from Nov 1 by Rs.2.41/litre and Rs.2.25/litre respectively (including state levies at Delhi) on the back of declining international oil prices,” Indian Oil Corp said.
“The movement of prices in international oil market and INR-USD exchange rate shall continue to be closely monitored and developing trends of the market will be reflected in future price changes,” it added.
Last month, the government deregulated diesel prices by linking the fuel cost to market-based pricing. Benchmark Brent crude fell Monday to a five-year low of $67.82 per barrel, dragged down by US crude which fell to its lowest since July 2009 to $64.66 a barrel.
Both benchmarks have been falling for five months running. The move follows the Oranisation of Petroleum Exporting Countries (OPEC) decision last week not to cut production in line with cartel leader Saudi Arabia’s strategy to combat the US shale oil boom.
Thanks to the technology of blasting shale rocks to yield oil and gas, US oil production has currently jumped to 8.97 million barrels per day while the country is importing almost that much less.
Lowering crude prices is also the result of a slowdown in Chinese demand and rise in output from otherwise strife-torn Libya, as well as the easing of concerns over supplies from Iraq where various factions are engaged in military combat.
Most OPEC members’ economies are sustained by high oil prices, and now find themselves revising their 2015 budgets to reflect lower prices.
OPEC’s November production stood at 30.56 million barrels per day, which was higher than the target of 30 million barrels per day.(IANS)