Business

Oil crashes after Saudi Arabia launches price war

The logo of the OPEC (Organization of the Petroleum Exporting Countries)

The logo of the OPEC (Organization of the Petroleum Exporting Countries)   | Photo Credit: AFP

The price of petrol and diesel are likely to come down further in the coming weeks as India follows the monthly average pricing of the benchmark crude oil.

The state-owned oil marketing companies (OMCs) have reduced the price of sensitive petroleum products like petrol by 24 to 27 paise a litre and diesel by 24 to 26 paise a litre across major cities as the price of international crude oil fell the greatest amount in a day since 1991 Gulf war.

Brent crude futures fell by as much as $14.25, or 31.5%, to $31.02 a barrel, the most since 1991 on March 9 after Saudi Arabia started a price war with Russia by slashing its selling prices and pledging to unleash its pent-up supply on to a market reeling from falling demand due to the spread of Coronavirus.

Petrol prices in Delhi decreased by ₹0.24 to ₹70.59 per litre and diesel dropped by ₹0.25 to rest at ₹63.26 per litre in Delhi, according to Indian Oil Corporation data.

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In Mumbai, petrol prices were cut by ₹0.27 and are now retailing at ₹76.29 per litre. Diesel prices on the other hand stand at ₹66.24 a litre after witnessing a price cut of ₹0.26 from last day’s prices.

The price of petrol and diesel have come down by around ₹5 each since beginning of this year.

In Kolkata, petrol is retailing at ₹73.28 a litre, down 23 paise compared with yesterday’s price of ₹73.51 a litre, and a litre of diesel will cost ₹65.59, 25 paise less than yesterday’s rate.

Similarly in Chennai, local prices of petrol and diesel are ₹73.33 (25 paise less) a litre and ₹66.75 (26 paise decrease) a litre respectively.

The price of petrol and diesel are likely to come down further in the coming weeks as India follows the monthly average pricing of the benchmark crude oil.

Many experts see Brent crude oil prices falling as a blessing for the macroeconomy as India imports over 83% of its crude oil requirements.

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Printable version | Jun 2, 2020 4:00:55 PM | https://www.thehindu.com/business/oil-crashes-after-saudi-arabia-launches-price-war/article31020497.ece

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