Oil companies are earning a profit of Rs1.60 per litre on petrol since 1st October, but want this trend to continue for some more days before announcing a price cut
New Delhi: Petrol price may be cut by about Rs1.60 per litre later this month as appreciation of rupee against the US dollar has helped state firms make profit on the fuel, reports PTI.
Indian rupee appreciated to five-month high since the government announced allowing foreign direct investment (FDI) in multi-brand retailing. This has eased the cost of imports for oil firms, helping them make profit on sale of petrol.
"Yes, there is about Rs1.60 per litre profit on petrol since 1st October. But we want this trend to stabilise before we think of cutting retail prices," a senior executive at one of the three state-owned fuel retailers said.
Petrol price was last revised on 24th July when it was raised by 70 paise to Rs68.48 per litre in Delhi. It was last cut on 3rd June when rates were reduced by Rs2.02 per litre.
The current profit is mainly on account of strengthening of rupee -- from Rs55.58 to a US dollar averages in the second half of August to Rs54.12 last fortnight.
Also, the prices of international gasoline, against which the domestic retail prices are benchmarked, have eased from $126.11 per barrel to $122.31.
Together, these have helped oil firms, which lost about Rs6,000 crore in revenue on selling petrol below cost this fiscal, make profits.
Rupee has further appreciated to Rs52.28, which would further give then scope for a price cut.
"We are committed to passing on any gains that we make but all we want to ensure is that this is not a temporary trend which can reverse in near future," the executive said.
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