Petrol price hiked by Rs. 1.40 a litre from midnight

Indian Oil Corp, India's largest state-owned oil company, will hike the price of petrol by Rs. 1.40 effective midnight tonight, the company said in a statement.

The company attributed this hike to increasing international crude prices and a falling rupee.

"International prices have increased from $128.57/bbl to $131.00/bbl since the last revision, and the rupee has depreciated from Rs.53.43 to Rs.54.15 per US Dollar during the period," Indian Oil said in a statement.

This hike does not take into account local sales tax or value added tax (VAT), so the effective hike for consumers will actual work out to more than the quantum announced.

This is the second hike in over two weeks, after the companies had on February 15 increased the price of the fuel by Rs. 1.50, and diesel by 45 paise.

Apart from losses on petrol, oil companies are also incurring a loss of Rs. 11.26 per litre on the sale of high-speed diesel, a loss of Rs.33.43 per litre on the sale of PDS kerosene, and a loss of Rs. 439 per cylinder of cooking gas, the statement added. While petrol is a deregulated commodity, the others are not, and the government fixes the selling price of these fuels.

The price hike is the 21st for petrol since the fuel was deregulated. Under deregulation, oil firms are free to decide the quantum and the frequency of a price hike. Since petrol prices were decontrolled in June 2010, they have been revised 28 times (increased 20 times and decreased eight times).