KTR to Modi: Why fuel prices don’t drop when crude oil price dips?

HYDERABAD: Telangana IT Minister and working president of the Bharat Rashtra Samithi (BRS) K T Rama Rao has asked who is benefitting from the frequent rise in fuel prices.

In a Monday morning tweet, the minister posted: “Straight question to PM Narendra Modi on skyrocketing fuel prices.” He highlighted the crude oil price versus the price of petrol in May 2014, when Narendra Modi assumed the reins of the country said the curde per barrel was $ 107 in May 2014 and the petrol per litre was costing Rs. 71.

However, the crude oil price per barrel was $65 in March 2023, while the per litre price of petrol was pegged at Rs. 110.

If fuel process had to be hiked when price of crude oil went up, should they also not be brought down when t he prices (of crude oil) drop? He posted an infographic that explained that the crude oil price was $ 105.56 in April 2014, it dropped steeply to $ 28.08 by January 2016. However, the decline in crude oil price not drastic. It happened over a period of time gradually.

The crude oil price went up to $80.08 in October 2018 – even this rise was gradual from the earlier position in January 2016. Interestingly, the price plummeted to $19.90 by April 2020 by the time the coronavirus pandemic set in across the globe. The fall was steep during pandemic from $80 to $60 and from there to sub 20-dollar level.

The crude per barrel surged again to $73.13 by September 2021and from there it began dropping gradually to $66 by March 2023.

However, there is no respite in the cost of petrol and also diesel.

In fact, by July 2022, the petrol price was hiked 78 times in one year (365 days) with the cost per litre peaking every day. The price of petrol was reduced only seven times during the full year between July 2021 and July 2022. Ditto with diesel prices which witnessed a hike for 76 times and barely 10 times of slashing. This information was provided to the Parliament by the Ministry of Petroleum and Natural Gas in response to a query on fuel price hikes.

In response to KTR’s tweet, an entrepreneur Nayini Anurag Reddy tweeted that the Modi Government had paid “Russia $20 billion for oil in just 7 months, more than what it paid in the last 10 years. It has only reaped higher profits of a few Indian companies.

“More than 3/4th of the discounted Russian oil is bought by Ambani’s Reliance & Russian controlled Nayara. They refine & further sell it for higher price.

“This govt is busy profiting few corporate companies, leaving common man in dark.”