New Delhi:As global crude prices surged following disruptions in the Strait of Hormuz due to the Iran war, countries across the world responded with steep fuel price hikes, emergency rationing, or subsidy cuts. India, however, took a slower and more controlled approach.
While petrol and diesel prices in India were finally raised by Rs 3 per litre on May 15 - the first revision in nearly four years - the increase remains among the smallest seen globally.
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India imports nearly 80-85 per cent of its crude oil requirement, making it highly vulnerable to global price shocks. Yet, instead of immediately passing on the burden to consumers, public sector oil companies reportedly absorbed heavy losses for around 76 days even as crude prices crossed $100 per barrel.
Government sources said this was a deliberate strategy aimed at protecting consumers, especially lower-income groups, from a sudden inflation shock.
How India's Fuel Price Hike Compares Globally
Several countries moved quickly to align domestic fuel prices with global crude prices.
Instead of rationing or allowing a steep pass-through, the Centre and oil companies absorbed under-recoveries that officials estimate touched nearly Rs 1,000 crore per day.
Officials estimate that petrol under-recovery had reached nearly Rs 26 per litre, while diesel under-recovery stood at around Rs 82 per litre before the May 15 revision.
Despite that, the actual increase was capped at Rs 3 per litre - roughly a 3-3.5 per cent rise on a base price of about Rs 95 per litre.
Source: India Latest News, Breaking News Today, Top News Headlines | Times Now
