- Diesel price cut by Rs 8.38 per litre in Delhi on Friday
- Effective 6 am, petrol price at Rs 80.43/litre, diesel at Rs 73.56
- On Thursday, Delhi government cut VAT applicable to diesel
The price of diesel came down by Rs 8.38 in the national capital on Friday, a day after the Delhi government announced a reduction in the value added tax or VAT applicable to the fuel. The VAT was brought down to 16.75 per cent from 30 per cent in the metro. With effect from 6 am on July 31, the price of diesel was lowered to Rs 73.56 per litre in Delhi, from Rs 81.94 per litre, while that of petrol was left unchanged at Rs 80.43, according to a notification from Indian Oil Corporation.
In a virtual press briefing on Thursday, the Chief Minister said the reduction in VAT would help propel Delhi’s economy. (Read Here: VAT Cut To 16.5%, Says Delhi Chief Minister Arvind Kejriwal)
In a rare occurrence, diesel had remained more expensive than petrol in Delhi for several weeks until Friday.
The prices of petrol and diesel are broadly determined by crude oil and forex rates. However, the retail rates vary from state to state due to local taxes.
Oil companies such as state-run Indian Oil Corporation – the country’s largest fuel retailer – review the rates of petrol and diesel on a daily basis, to align them with global oil prices. Any revisions are implemented at fuel pumps with effect from 6 am every day.
The retail fuel prices – the price that the consumer pays for fuel in different parts of the country – are calculated by adding excise duty, dealer commission and VAT on the rate applicable to dealers.
Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation account for the majority of fuel stations in the country.