Union Petroleum Minister Blames States for Skyrocketing Fuel Prices

DELHI: Union minister Hardeep Singh Puri has squarely blamed states for the high rise in fuel prices across the country. He said that this is due to states not bringing fuel under the ambit of Goods and Services Tax(GST).

While talking to reporters he said "If your question is do you want the petrol prices to come down then the answer is yes. Now, if your question is why the petrol prices are not coming down, then the answer is because the states don't want to bring it under GST," PTI quoted Puri as saying.

Adding on the minister said that the Centre charges ₹32 per litre as a tax on petrol. ₹32 per litre was charged when the fuel price was USD 19 per barrel, and even after rising in price to USD 75 per barrel, the centre is charging the same.

Under the pricing formula adopted by oil companies, rates of petrol and diesel are to be reviewed and revised on a daily basis. The new prices become effective from the morning at 6 a.m. The daily review and revision of prices are based on the average price of benchmark fuel in the international market in the preceding 15-days, and foreign exchange rates.

But, the fluctuations in global oil prices have prevented OMCs to follow this formula in totality and revisions are now being made with longer gaps. This has also made companies keep the increasing fuel prices whenever there is a mismatch between globally arrived and pump price of fuel.

Fuel consumers can expect fuel prices to remain unchanged or get some relief by way of a cut in days ahead as global oil is expected to remain soft. Oil cartel OPEC and its allies have agreed to gradually raise production levels that should prevent upward price movement. The concerns on demand due to the pandemic is also affecting oil prices.

Also read: Petrol, diesel price revision on hold

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