Petrol and diesel rates are set for a
sharp drop after global crude oil prices tumbled
nearly $7 a barrel in nine days.
It is indeed a good piece of
information to the public. It will not be an exaggeration to say that almost
many vehicle-owners, be it a two wheeler or even a four wheeler, woke up every
day morning till recently with the first thought, ‘How much more to pay today
State oil companies fix domestic rates of
petrol and diesel based on international fuel prices, the
exchange rate and taxes.
They have the freedom to pass on all
hikes and reductions daily to consumers, but have lately begun to wait for
signals from the government to do so. That’s why local prices don’t always
mimic international trends.
Lower prices would bring relief to the public
first of all, and the government which has faced public anger over rising
prices and calls for duty cuts to bring down local fuel rates.
International crude oil prices have declined
sharply in the past 10 days, with Brent going close to $72 a barrel on
Thursday. The prospect of increased supply from key producing countries and a
fear of trade war between the US and China hurting oil demand have been
weighing on the global rates.
Hints of the US probably agreeing to
offer waivers to India and some other key importers of Iranian oil have
lessened worries that a significant share of supplies from the Islamic Republic
would go off the market.
Saudi Arabia, Russia, the US and other key
producers are expected to raise output to meet new demand, as well as any
shortage due to Iranian supply cut.