Image for representation. (Image: Reuters)
For the first time in living memory, Diesel has become costlier than petrol in the national capital after prices were hiked for 19 days in a row. On Thursday, the retail prices of diesel increased by Rs 0.14 taking the cost for a litre to Rs 80.02/litre, marking the highest price of diesel ever recorded here.
While, the petrol price in the national capital stood at Rs 79.92/litre (increase by Rs 0.16).
The unprecedented development came after petrol prices remained unchanged after a spell of 17 consecutive hikes and diesel prices continued to rise.
Ever since Oil Marketing Companies (OMCs) restarted revising fuel prices on June 7 after an 82-day-long hiatus, petrol and diesel prices rose by Rs 8.5 and Rs 10.49 per litre, respectively.
Till the end of 2012, Diesel used to cost around two-thirds of the cost of petrol or less in New Delhi. Between 2002 and 2012, retail prices of petrol exceeded retail prices of diesel by at least 28 per cent at its lowest in 2010 and nearly 79 per cent in May 2012 – the widest recorded gap between the prices.
On average, from April 2002 to December 2012 petrol remained 50 per cent more expensive than diesel. In the years since then, the gap in prices of diesel and petrol has continued to shrink.
On May 16, 2014, when the Narendra Modi-led Bharatiya Janata Party (BJP) assumed office at the Centre, petrol was still 25 per cent costlier than diesel.
Following subsequent revisions in central excise duty on fuel, even as global crude prices remained low, the difference between prices of diesel and petrol further shrunk to 20 per cent by the time daily revision of prices began in June 2017.
This gap declined to a single-digit figure for the first time in October 2018 at a time when fuel prices touched historic highs across the country on account of rising crude prices.
While the difference between diesel and petrol prices largely remained the same, till last month when a sharp increase in VAT on diesel was imposed by the Delhi government and an increase in central excise duty – the burden was passed on to the consumers.
In the first week of May, while the NDA government at the Centre revised the excise duty on petrol to Rs 32.98 per litre and Rs 31.83 on diesel with a record increase of Rs 10 and Rs 13 per litre respectively, the Delhi government hiked the state VAT on diesel by Rs 7.1 per litre and on petrol by Rs 1.67 per litre even as crude oil prices plunged to historic lows due to a sharp fall in global demand in midst of the COVID-19 pandemic.
The revision in VAT rates left petrol just 2.7 per cent costlier than diesel which further reduced as diesel witnessed sharper hikes than petrol.
The opposition reacted on the record-high prices, Senior Congress leader Randeep Surjewala tweeted, “Waah Modi ji, jo 73 sale mean nahiq hua who car hi dikhaya! diesel ki qeemat petrol ke paar (Wow Modi ji, you’ve done what never happened in the last 73 years. Diesel is now costlier than petrol).”