Fuel price hike hits South India hard; two major cities see steepest rise

Petrol, diesel price hike: Two major South Indian cities, Hyderabad and Thiruvananthapuram, have emerged among the worst hit by the Union government’s fuel price hike announced on May 15, with both capitals now ranking as the most expensive cities for petrol and diesel following the revised rates that came into effect today.

The Telangana's capital city recorded the highest petrol prices among the Indian cities as the consumers will have to pay Rs 110.89 per litre, after witnessing a surge of Rs 3.39 per litre.

While the Kerala's capital Thiruvananthapuram emerged as the second most expensive place for the petrol with Rs 110.75 per litre, up by Rs 3.37 per litre.

For diesel, Thiruvananthapuram emerged as the most expansive with Rs 99.63 per litre while Hyderabad is at the second place at 98.96 per litre.

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West Bangal's capital Kolkata is the third most expansive city for the petrol with Rs 108.74 per litre, up Rs 3.29 per litre from the previous rates.

In Mumbai, petrol now costs Rs 106.68 per litre and diesel Rs 93.14 per litre, both up by Rs 3.14 and Rs 3.11 respectively.

Chennai saw petrol prices rise by Rs 2.83 to Rs 103.67 per litre, while diesel increased by Rs 2.86 to Rs 95.25 per litre.

The much anticipated price rise in the petrol and diesel will significantly impact daily expenses of consumers and travelers across the country.

The price rise shocker came just three days after Union Petroleum Minister Hardeep Singh Puri claimed that the country has no supply side problems.

"Let me tell you categorically, we have no supply side problems. The country has more than enough stocks of crude oil, LNG and LPG, Puri said speaking at the CII Annual Business Summit in the national capital.

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Despite the assurances, social media was abuzz of the possible price rise in the petrol and diesel.

Many market experts had anticipated that the center will make an upward revision in the fuel rates.

However, Puri expressed a deep concern on the losses incurred by Oil Marketing Companies (OMCs). He revealed that OMCs are losing nearly Rs 1,000 crore every day, giving a support to the anticipations of the price rise.

If you look at the fiscal situation, if you look at the fact that my oil companies are losing Rs 1,000 crores every day, the under recovery is going to be Rs 1,98,000 crores. The losses are Rs 1 lakh crore, if you look at the quarter. In that context, how long can you keep it like this? Where is the oil? It used to be around USD 64 or USD 65. It has gone up to USD 115 in that basket,” Puri had said during the CII's event.

Speaking at the same event, Uday Kotak, Chairperson of Kotak Securities, cautioned that rising geopolitical tensions could put pressure on India’s trade balance, currency stability, and import bill, particularly through higher commodity prices. He added that the shocker is coming in a big way.

Kotak further said, "We must prepare for the worst. Therefore, it is about preparation, being ready for tough times, rather than waiting for the shock to hit us."

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According to the government, India has a stock of 60 days of crude oil, 60 days of Natural Gas and 45 days of liquid petroleum gas (LPG).

India is among the few countries where petroleum prices have held steady through this period of global volatility, even after more than 70 days since the conflict started.

According to the center, the foreign exchange reserves stand at a comfortable 703 billion US dollars. India is the world’s third-largest oil refiner and fourth-largest exporter of petroleum products, exporting to over 150 countries and meeting domestic demand in full.  

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