Rising petrol and diesel prices in India and what comes along with it.

Petrol prices have stood up for about 21 times till now, in the year 2021. Petrol has touched Rs. 89 per liter in Delhi on Monday, and diesel has touched a price hike of Rs. 86.30 per liter in Mumbai and If you’re a person who belongs to a middle class family, this huge hike in the petrol and diesel prices must have disturbed you to a great extent and why shouldn’t it bother you anyways?

Let us first look at the reasons for this price hike.
The fuel prices in India are linked to the global crude oil price prices. Therefore, any rise or fall in the international crude oil prices is supposed to have a direct impact on the fuel prices in India. During this coronavirus pandemic in the year 2020, many business activities crashed, lockdown was imposed on many countries including India, leading to a fall in the crude oil prices at the international level. However, at the same time the government expenditures started to increase as it needed huge amount of fund to fight the pandemic condition in a highly populated country like India. The government used to rely heavily on the liquor and petroleum sectors for revenue generation. Therefore, when the crude oil prices started falling at the international level, the government started imposing high taxes on the crude oil prices in order to compensate for the loss and earn more and more revenue. so now when the global crude oil prices have started going, the effective increase in the price is being passed on to the consumers.

Brent crude, which used to be traded at about $40 per barrel between the month of June and October, had started rising in the month of November, and has now passed the $60 per barrel mark as the vaccines have started coming out. Technically, when the crude oil prices fell during the pandemic, the consumers should have had some relaxation or benefits but apparently not. Another reason for the rise in the petrol and diesel prices in India is the controlled production of crude oil in the pandemic to boost up the price. Countries who took such steps are the Organisation of Petroleum Exporting Countries (OPEC) and its allies, including Russia who had cut the oil production by 9.7 million barrels per day the month of May in 2020. Saudi Arabia had decided to cut down on the production by 1 million barrels per day in the month of February and March this year. However, India has urged the other oil producing countries to ease the cut on crude oil production so as to give relief to Indian consumers.

So to give a gist of the factors affecting rising fuel prices in India are:

  1. Rise in International crude oil prices
  2. High tax imposition by the government
  3. Cut down on oil production by the major oil producing countries at the time of the pandemic to boost up demand.


Andhra Pradesh 87.24 ₹/L
Assam 86.44 ₹/L
Bihar 91.91 ₹/L
Chhattisgarh 88.06 ₹/L
Gujarat 86.67 ₹/L
Haryana 87.67 ₹/L
Himachal Pradesh 87.55 ₹/L
Jammu And Kashmir 91.12 ₹/L
Jharkhand 87.27 ₹/L
Karnataka 93.21 ₹/L
Kerala 90.00 ₹/L
Madhya Pradesh 97.56 ₹/L
Maharashtra 96.62 ₹/L
Odisha 90.25 ₹/L
Punjab 88.64 ₹/L
Rajasthan 96.01 ₹/L
Tamil Nadu 92.25 ₹/L
Telangana 93.78 ₹/L
Uttar Pradesh 87.98 ₹/L
Uttarakhand 88.64 ₹/LT
West Bengal 91.41 ₹/L
NCT Of Delhi 90.19 ₹/L

Whenever there is a hike on petrol and diesel prices, the government is usually the one to be blamed. Most of the common people and the opposition parties have been attacking the Modi government right, left and center. People are questioning the “acche din” that the Modi government had promised in the past. Different narratives about the political unrest in the country like the Anti- CAA protests, the Ram Mandir issue, Internet ban in Kashmir and Delhi, the Farmers Protest, the intervention of international celebrities and the arrest of activists who spoke for the cause, etc. have been brought up and the government has been put under a lot of pressure.

Prime Minister Narendra Modi on Wednesday, February 17, said that the middle class community of the country would not have been this affected if the previous government had taken effective measures in the past to reduce the energy import dependence. Without even talking about the money hike in petrol and diesel prices in the recent few days, the Prime Minister spoke about the energy that India had been importing in the previous years under previous governance. He said that India had imported over 85% of its oil needs in the year 2019-20 and almost 53% of its gas requirement.


  1. This will have an immense impact on people commuting to far-off areas on a daily basis for work.
  2. It will also affect the people who have to travel a little bit in order to buy basic daily needs items such as grocery.
  3. It might affect the farmers as well during the monsoon time, if the rainfall received is insufficient, as they have to rely more and more on diesel-powered irrigation.

See also  Petrol price can come down to Rs 75 if brought under GST, but there is a lack of political will: SBI Economists

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