The Oil marketing companies have now dropped the petrol prices by Rs. 3.05 per litre and increased the diesel price by 50 paise per litre (excluding local taxes and VAT). The change in prices have already come into effect.
This has been for the first time since May this year, the Oil Marketing companies have reduced the prices of petrol, while the diesel prices have been continuously increased since government partially de-controlled the diesel prices. The petrol prices were de-controlled since June 2010, and the prices are now based on market conditions. The diesel is still under government control, allowing only minor revisions.
The regular fall in the value of Rupee against the Dollar had forced the oil firms to raise fuel prices, as OMC's buy crude in dollars. However, the tough measures taken by the new Reserve Bank of India governor Raghuram Rajan, which strengthened the value of Rupee against the US dollar.