Oil’s not well when prices swell!
The fuel prices are rising after the immediate aftermath of the pandemic to reach all-time highs of above ₹100/litre. Two main reasons are cited for this rise- rise in international crude oil prices and increase in central and state taxes.
The petrol and diesel prices were deregulated in 2010 and 2014 respectively. Up until this point, retail prices were decided by the state. On the other hand, kerosene and LPG still come under the subsidised area. Despite deregulation, taxation still plays a role in determining prices.
While a fall in crude prices leads to a rise in taxation, the converse may not necessarily take place. The fuel prices in our neighbourhood are also much lower. With travel and commute resuming, the effect of the price rise will likely be witnessed by a significant portion of the population.