The hike, effective midnight tonight, is excluding local sales tax or VAT. The actual increase will be higher and will vary from city to city.
However, the price of non-subsidised cooking gas (LPG), which customers buy after consuming their quota of 12 subsidised cylinders, was cut by Rs 107 per cylinder on easing international rates.
The price of diesel in Delhi will be hiked by 57 paise, including tax, to Rs 54.91 per litre, while it will cost Rs 63.23 a litre in Mumbai as against Rs 62.60 at present.
The diesel price hike is in line with the January 2013 decision of the government to raise rates by up to 50 paise per month till such time that the entire losses on the fuel are wiped out, and prices made market determined.
Announcing the price hike, Indian Oil Corp, the nation’s largest fuel retailer, said that even after the 13th price hike since last January, oil companies are incurring Rs 9.24 per litre loss on sale of the fuel.
Officials said there will be no change in petrol rates as current price of Rs 72.43 a litre in Delhi was almost in line with the cost.
The 14.2-kg cooking gas cylinder that consumers buy beyond their entitled 12 bottles at subsidised rates, will now cost Rs 1,134, down from Rs 1,241, in Delhi.
Non-domestic LPG rates were at the beginning of the year hiked by a steep Rs 220 per cylinder but have now been cut in line with softening of international oil rates.
IOC said losses on LPG have come down to Rs 656 per 14.2-kg cylinder from Rs 762.50.
Diesel price was last hiked by 50 paise on January 4.
Since January 2013, diesel rates have risen by a cumulative Rs 7.76.
“Even after the current increase, under recovery (loss) on retail diesel shall stand at Rs 7.40 per litre,” IOC said in a statement.
Besides diesel, IOC was losing Rs 35.76 a litre on sale of kerosene through Public Distribution System (PDS) and Rs 656 on sale of 14.2-kg subsidised domestic LPG cylinder.
“For the year 2013-14, the Corporation is expected to incur under-recovery (revenue loss) of around Rs 73,700 crore on sale of three sensitive products and industry (IOC plus Bharat Petroleum Corp and Hindustan Petroleum Corp) would incur around Rs 1,42,000 crore,” the statement added.
On diesel, it said, the government had on January 17, 2013 authorised oil marketing companies to increase the retail selling price within a small range every month.
“Accordingly, since then, retail diesel prices are being revised every month,” it said.