Petrol and diesel prices across several Indian cities have changed little on Friday, 20 March, continuing the recent trend of stability in retail fuel rates even as global oil markets see volatility.
The conflict involving the United States, Israel, and Iran has entered its third week with no clear sign of de-escalation. It began on 28 February, when coordinated US-Israeli strikes targeted Iran, prompting Tehran to retaliate with an attack across US military bases in the Middle East.
As of late, global energy markets have been rattled by rising geopolitical tensions in the Middle East, pushing Brent crude to near $108 a barrel this week. The conflict also led to a de facto halt in shipments through the Strait of Hormuz, an essential passage for oil markets.
City-wise fuel rates on 20 March
The following retail rates are currently active in major cities across India:
Who is responsible for fuel pricing?
The three major OMCs responsible for fuel pricing and distribution in India are Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL).
To keep domestic fuel prices aligned with international crude oil prices and currency exchange rates, Oil Marketing Companies (OMCs) revise petrol and diesel prices every day at 6 AM.
Retail fuel prices in the country are influenced by several factors, including the price of crude oil in international markets, the rupee-dollar exchange rate, and taxes imposed by the central and state governments.
What’s behind the steady fuel prices in India?
While in most countries a spike in crude prices leads to higher fuel costs, the same trend was not observed in India, where fuel prices remained steady throughout the weeks.
This has happened because of a calibrated “shock absorber” system where oil marketing companies and the government smooth out global volatility, which in turn protects consumers in the short term, but not without trade-offs, Mint reported.
In simple terms, when international crude prices surge, OMCs such as BPCL and OIL often absorb the increase rather than immediately passing on the price difference to consumers.
At the same time, in the United States, a gallon of regular petrol that averaged $2.94 in February now costs $3.5, marking a 20% increase, according to AAA Fuel Prices, a retail fuel price tracker from the American Automobile Association.