Petrol, diesel price cut on the cards? Hardeep Puri explains the timing

State-owned fuel retailers incurred losses of about ₹74,781 crore on the sale of petrol, diesel and LPG in the three months ended June as they absorbed the impact of elevated global crude oil prices triggered by the West Asia conflict, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said on Thursday.

The losses were incurred even as state-owned oil marketing companies (OMCs) raised petrol and diesel prices in May after international crude prices surged following the conflict.

Addressing reporters, Puri said the losses were for the period up to June 30 and reflected the high cost of crude purchased during the peak of the crisis.

He explained that oil companies typically procure crude oil around two months in advance and are currently processing cargoes bought in April and early May, when international prices were substantially higher.

The average price of the Indian basket of crude oil stood at $114.48 per barrel in April, $106.23 in May and $83.22 in June.

It has since declined sharply to $68.28 per barrel as on July 1.

Crude prices eased after the United States and Iran signed a 14-point memorandum of understanding that could pave the way for a peace agreement.

Asked whether the decline in crude prices would translate into lower petrol and diesel prices, Puri said it would be a "legitimate question" if international oil prices stayed low for the next few weeks.

He also highlighted India's ability to maintain uninterrupted fuel supplies despite the conflict-linked disruptions.

"Why did we do well and come out of the crisis without any closures and dry-outs? In the entire period of March, April, May and June, there were no dry-outs. By and large, there was no disruption, shortage or queues," Puri said.

Petrol and diesel prices at state-run retailers were last increased on May 25 as Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd passed on part of the increase in international crude prices.

The three state-owned retailers have not revised pump prices despite the correction in global oil prices.

In Delhi, petrol continues to retail at ₹102.12 per litre and diesel at ₹95.20 per litre at Indian Oil outlets.

Private fuel retailer Nayara Energy, however, reduced petrol prices by ₹5 per litre and diesel by ₹3 per litre across its network of over 7,000 outlets from July 1 after crude prices softened.

The reduction fully reversed the price increase Nayara had implemented in March after the West Asia conflict drove up international oil prices.