Oil minister Hardeep Singh Puri: Fuel may get cheaper if global crude prices stay at current levels

New Delhi: Oil minister Hardeep Singh Puri Friday held out hopes of a cut in petrol and diesel prices — the first in a year — if global crude prices remain at the current subdued levels.

“Today I can tell you seriously. If audience asks when will fuel prices come down further, I would say if this trend (low crude prices) continues, there is reasonable expectation (of a fuel price cut),” Puri said.

Fuel prices were last cut by Rs 2 per litre on March 14, just ahead of LS polls. Prices had till then had remained frozen since May 22, 2022, when Centre reduced excise duty for the second time after Nov 4, 2021. The two reductions together had brought down excise duty on petrol and diesel by a total of Rs 13 and Rs 16 per litre, respectively.

After the second duty cut, BJP-governed states implemented matching cuts in VAT to soften the impact of oil prices surging above $100 per barrel after the Ukraine conflict.

Expectations of a reduction in pump prices have been growing since Sept last year when benchmark Brent crude slumped below $70 per barrel after hitting a high in April 2024. Prices have remained subdued since then, except for brief rallies in June and Sept 2024, and have been trading in the $70-75 per barrel range.

State-run fuel retailers have not passed on the benefit of positive marketing margin on the back of lower crude prices, unlike private retailers. Puri pointed out losses incurred by the state retailers on domestic LPG, over and above the subsidy support in the Budget for supplies under Ujjwala scheme.

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