Mumbai, April 16, 2013: Effective midnight of April 15, the price of petrol was cut by Re 1 per litre, the third price reduction in a month. After including VAT, the fall in the price of the fuel in Mumbai is Rs 1.26 per litre, with the fuel cost Rs 72.88 per litre against the earlier Rs 74.14. (see price chart below).

This latest cut is the third within a month. On April 2, petrol prices were reduced by 85 paise a litre, and earlier on March 16, there was a Rs 2.40 cut, the sharpest slash in over nine months.

The current price reduction is a result of a fall in international crude oil prices, excluding local sales tax or VAT. According to oil marketing company Indian Oil Corporation (IOC), since the last price change on April 2, international prices of petrol have gone down from $119.23 (Rs 6,470) per bbl to $116.61 (Rs 6,328/bbl), a difference of Rs 142. One bbl or barrel is the unit of volume for crude oil and petroleum products and equals 42 US gallons or 35 UK (imperial) gallons, or approximately 159 litres.

There is, however, no change in the price of diesel although the OMCs were expected to hike the price by 40-50 paise a litre on April 15. In a government decision taken in January 2013, it was decided to increase the price of diesel per litre by 40-50 paise till all losses on the fuel are eliminated. According to IOC, OMCs are currently losing Rs 6.48 per litre of diesel fuel.

NEW PRICE OF PETROL IN KEY CITIES (in Rs)