The Modi government is mulling to cut diesel prices for the first time in seven years amid global crude price plummeting below $100 a barrel for the first time in more than a year
The move could help stall rising inflation as a patchy monsoon threatens to further increase the food prices
This comes as the government has been considering freeing up diesel prices, since subsidy has been narrowed by incremental, monthly price increases.
“If this downward trend in international oil prices continues and the rupee appreciates even marginally, there will be over-recovery from this month,” a report quoting a senior executive of an oil PSU said.
“A price review is expected on September 15. But the decision regarding diesel price cut will be taken by the government because it is a regulated fuel,” the official, who did not want to be named, said
The government is still evaluating the political situation in poll-bound states before deregulating the fuel, officials said.
The Benchmark Brent crude fell on Monday to a 14-month low of $99.59 per barrel, dropping below $100 for the first time since June last year because of sluggish demand from major importers, particularly China.
