Volatile Oil Prices Keep Fuel Rates Unchanged Amid Political Uncertainties

International oil prices have been fluctuating widely, impacting petrol and diesel rates in India. Despite a drop in input costs, state-owned fuel retailers have not reduced prices to manage volatility. With upcoming elections in Maharashtra, decisions on price cuts remain uncertain.

International oil prices remain highly volatile, falling one day only to rise the next, according to a top oil ministry official. This instability has led to no reductions in petrol and diesel prices, even as input costs have softened.

Global oil benchmark Brent crude futures dipped below USD 70 per barrel last week but soon rebounded to USD 74.58, while West Texas Intermediate also rose. The fluctuating prices complicate decisions on fuel price cuts, especially ahead of important elections like those in Maharashtra.

State-owned fuel retailers like IOC, BPCL, and HPCL have not revised prices in line with costs since late 2021, resisting pressure to revert to daily price adjustments. Industry sources suggest that while these companies are currently making good profits, they prefer to wait for more stable prices before considering any cut.

(With inputs from agencies.)