India raises petrol and diesel prices by Rs 3 per litre amid soaring crude costs
Petrol and diesel prices in India have risen by Rs 3 per litre—the first such increase in over four years. The move comes as global oil prices surged due to escalating tensions between the US, Israel, and Iran. The price hike followed a steep climb in international crude costs triggered by the US-Israeli conflict with Iran. State-owned oil companies, facing heavy losses, adjusted domestic fuel rates to ease financial strain.
Before the increase, daily losses for oil marketing firms reached around Rs 1,000 crore. After the adjustment, these losses dropped to roughly Rs 750 crore—a reduction of nearly 25%. Despite this relief, the government has not yet announced any subsidy support for the struggling companies. Analysts at DBS Bank warn that the price rise could push headline inflation up by 15-25 basis points. However, the Rs 3 per litre adjustment may not be enough to restore profitability if crude prices stay high. Cumulative losses since the conflict began are projected to surpass Rs 1 lakh crore by the end of May.
The fuel price increase has slightly reduced losses for state-run oil firms but has also added modest inflationary pressure. Without further government intervention or a drop in global crude prices, financial challenges for these companies are likely to persist.
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