Hike In Excise Duty Aimed To Meet Budget Deficit, Says Oil Minister

International crude prices were ruling at $107 per barrel when the National Democratic Alliance (NDA) government came to power in May. It went up to $115-117 per barrel at the height of Iraq crisis but have since retreated to below $70, he said at an Assocham event.

The slump led to petrol prices being cut seven times since August and diesel on three occasions in last one-and-half-months, he said. The oil firms had on 1 December cut petrol and diesel prices by 91 paise a litre and 84 paise per litre, respectively to factor in slump in international oil prices. The seventh reduction in price since August made petrol cost 63.33 a litre in Delhi, 10.27 per litre less than what it was in July.

The third reduction in diesel rates in one month has led to the price coming down to 52.51 a litre. Brent rates, the benchmark grade for more than half of the world’s oil, have dropped to $68.34 a barrel, the lowest level since October 2009. Prices declined 18 per cent last month and are 38 per cent lower in 2014. Pradhan said the government is committed to easing business environment so that manufacturing gets a boost and more jobs are created.