In recent times the price of petrol as well as diesel has dropped several times. It has hit an all time low compared to previous years. This slash in prices of fuel is not because of the newly formed government in India.
The fact is that global prices of fuels have fallen significantly. The price is lowest in the past four years, which is major concern. The price for a barrel currently is 70 USD and is expected to dip further.
Currently petrol is priced at Rs 65 for a litre, however, experts believe it could be slashed further and may become even lower than Rs 60 per litre(Delhi fuel prices). India is a major importer of crude oil and we account for almost two-thirds of import against the whole.
Organization of the Petroleum Exporting Countries or OPEC has even contemplated a cutback in production. International crude oil prices have fallen down sharply. earlier this June a barrel would cost INR 6,600, however, the price for a barrel has fallen down to INR 4,800.
Out of the many countries in the world India ranks as fourth latest consumer of oil. We import approximately 190 million tonnes per year of crude oil, which costs us 145 billion USD. This further brings India's expenditure further down and we have more money for other needs.
The drop in petrol and diesel price is evident, however, we are not sure when it would take place. If petrol price falls lower than Rs 60/ litre in Delhi, it will be the first time since May 2011, that fuel was this affordable. There are several factors that play a vital role in fuel prices. For starters Rupee has to keep trading within the 58 to 62 range against USD.