Pressure continues to mount on fuel retailers amid higher global energy prices, as Nayara Energy, India’s largest private fuel retailer, has increased fuel prices with immediate effect. Petrol prices have been increased by ₹5 per litre, while diesel prices have risen by ₹3 per litre.
The latest hike marks another price revision by Nayara Energy this year, as Indian refiners deal with the impact of geopolitical disruptions on global crude oil and fuel markets, news agency PTI reported on Saturday, citing people familiar with the matter.
According to the report, India’s largest private fuel retailer, which operates over 7,000 fuel stations across the country, announced the price hike with effect from the early hours of Saturday.
Nayara Energy passes surge to consumers
When the US-Iran war disrupted energy supplies after breaking out in late February, Nayara Energy became the first fuel retailer to pass the impact of higher international oil prices on to consumers. On March 26, the company raised petrol and diesel prices by ₹5 and ₹3 per litre, respectively, taking the rates at its outlets to ₹100.71 and ₹91.31 per litre, respectively.
However, Nayara Energy later reversed the March price hike. On 1 July, the largest private fuel retailer slashed petrol prices by ₹5 and diesel by ₹3 a litre. The reduction came after global crude prices eased as tensions in West Asia subsided. It was the first reduction by a fuel retailer in over two years and subsequently brought Nayara’s pricing back in line with state-owned retailers.
The latest increase signals another effort by the private fuel retailer to reflect rising costs in retail prices following a period of relatively stable rates.
State-owned fuel retailers keep fuel prices relatively stable
In contrast, state-owned fuel retailers began transferring the impact of higher international oil prices to consumers in May. They raised petrol and diesel prices through a series of staggered increases, with the cumulative hike reaching around ₹7.50 per litre for both fuels by the end of May. The fourth increase, announced on 25 May, was ₹2.61 per litre for petrol and ₹2.71 per litre for diesel.
State-owned oil marketing companies (OMCs), including Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, have a market share of over 90 per cent of India’s 1,04,137 petrol pumps and have historically kept prices relatively stable, despite fluctuations in global crude prices.
Govt asks private retailers not to restrict fuel sales at outlets
On Thursday, the Centre asked private fuel retailers not to limit petrol and diesel sales at their outlets, after Nayara and Jio-BP limited supplies at some pumps amid losses on retail fuel sales.
Officials said the price difference between retail and bulk diesel had led industrial consumers to purchase cheaper fuel from retail outlets, putting additional pressure on supplies.
The latest price hike comes against the backdrop of the US-Iran war, which has disrupted global energy supplies and added to pressure on fuel retailers facing higher crude oil and fuel costs.
(with PTI inputs)