As per sources, the fuel prices have increased by around Rs 5 per litre in the past 7 months. On that day, the rate in Mumbai was Rs 86.24 per litre. The surge in fuel prices is due to spike in global crude prices and the depreciation of the rupee, reports said.
On Monday, Andhra Pradesh Chief Minister N Chandrababu Naidu said price of petrol would soon touch Rs 100 a litre as also the rupee against U.S. dollar.
In Kolkata and Chennai petrol touched Rs 82.06 and Rs 82.24 per litre while diesel increased to Rs 74 per litre and Rs 75.19, respectively.
Had the government not stepped in to absorb most of the under-recovery caused by the sinking value of the rand and a modest rise in worldwide oil prices, the price of petrol would have gone up by 28 cents per litre and diesel by 31 cents a litre on Wednesday 5 September, according to the normal Central Energy Fund calculations, and that's over and above the aforementioned 5 cent retail increase.
Government blames falling rupee value fuel price hike.
The fuel prices have been increasing continuously since the beginning of August on the cue of rising crude oil prices and falling rupee against the United States dollar. The excise duty on petrol increased from Rs 9.48 per litre to a high of Rs 21.48 per litre by January 2016.
He said that the relentless rise in prices of petrol and diesel is not inevitable because the price is built up by excessive taxes on fuel. "If taxes are cut, prices will decline significantly".
The government has been under vast pressure to cut excise duty on petrol and diesel to bring the prices of fuel oil down. Diesel was at Rs 75.54/litre, up by Rs 0.44/litre.
Fuel prices have been on a continuous rise for the past 10 days. "Secondly, global currencies have weakened against the United States dollar".
This year, there's South Africa has been hit by record fuel prices.
The Central Excise Duty is levied by the central government.
The central government had raised excise duty on petrol by Rs 11.77 a litre and that on diesel by 13.47 a litre in nine instalments between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October past year by Rs 2 a litre.