New Delhi: Domestic fuel prices have begun a slow decline as international rates tumble under the weight of record US crude output and US President Donald Trump’s threat to sharply raise tariff on Chinese goods.On Monday, petrol sold for Rs 73 a litre and diesel at Rs 66.66 at Indian Oil Corporation pumps in Delhi. Rates of petrol and diesel have fallen 13 paise and 5 paise a litre, respectively, in two days and if the fall in international oil rates continues over the next few weeks, domestic decline would be sharper.Domestic fuel prices are based on the trailing 15-day average of international oil prices and exchange rates. Sometimes, especially during polls, it’s hard to predict domestic fuel price trajectory as state-run oil companies do not necessarily follow international trend. A 10% fall in 10 days shows the market isn’t too worried about Iranian supply going out of the market. Lower prices are good for India , which imports nearly 84% of its oil needs, as they help keep inflation and current account deficit in control.

Source: Economic Times May 07, 2019 02:48 UTC