New Delhi: Despite a 40 per cent slump in the price of the Indian basket of crude oil since February 2022, consumers in India are still paying for the fuel as these were when the rates were close to $130 a barrel.

The price of crude oil is trading near $73 a barrel, a decline of about 40 per cent, and likely to decline further in the coming due to adverse economic impact in the big international markets.

However, in India, the benefits of a slump in crude oil prices are not likely to pass on to consumers. Recently Petroleum Minister Hardeep Puri had categorically denied the reduction in fuel prices and claimed that the state-owned retailers had incurred losses of Rs 27,000 crore due to selling pump fuel at below imported prices and oil companies would use the cushion of lower global crude prices to recoup their losses.

In parliament, the union minister revealed that the retail prices of petrol and diesel in India had increased by 18.95 per cent and 26.5 per cent, respectively, over the past two years. In the same period, the average price of the Indian crude oil basket increased by 102 per cent.

Responding to the opposition query over high fuel prices, the minister vehemently denied a relook at the high central taxes on fuel, instead, referred to six states, which had not cut local taxes and said prices in those states would come down if those states did so.

He mentioned that the Centre lowered the excise duty twice from November 2021 to May 2022, while the opposition ruled six states have still not lowered the value-added tax (VAT) on fuel.

“To insulate the Indian consumers from the impact of high international crude oil prices, the government had reduced the central excise duty twice on November 21, 2021, and May 22, 2022, effecting a cumulative reduction of ₹13 and ₹16 per litre for petrol and diesel respectively, which was fully passed on to consumers,” it said.

Following these reductions in central excise duty, some of the states and union territories (UTs) also reduced value-added tax (VAT) rates on petrol and diesel, he said.

“The states of West Bengal, Tamil Nadu, Telangana, Andhra Pradesh, Kerala and Jharkhand did not cut their taxes. I would request the members of parliaments from these states that they ask their respective state government to lower the VAT,” Puri said.