In a big boost for consumers, diesel and petrol prices are likely to be cut by about Rs 2.50 a litre soon. The move will reduce inflation as diesel rates would be down 11% in less than two weeks, government and industry sources told financial daily The Economic Times. The crucial step is expected ahead of Assembly Elections in Jharkhand and Jammu & Kashmir.
The price cut is likely to be effected due to a sharp fall in international oil prices. Brent crude fell to a four-year low of $82.60 per barrels two weeks ago from above $115 in June. It was trading at $87 per barrel on Wednesday.
The newspaper on Thursday said the executives of state oil marketing firms are expected to meet on Friday or Saturday, where decision of exact quantum would be taken after tacit approval of petroleum ministry.
This will be the sixth consecutive reduction in petrol prices since August and the first cut in diesel rates after the government deregulated the fuel. The Cabinet on October 18 allowed state oil firms to align pump prices of diesel with market rates and announced Rs 3.37 per litre price cut. Petrol price was deregulated by the previous UPA government in June.
The reduction in auto fuel rates would pull petrol prices to a 16-month low and diesel prices to a level where they existed a year ago.
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