Don’t say : Increase in Petrol price reflects International Crude Oil Prices

From where I see, of the the biggest mistakes committed by the present Modi Government in its 4 years in Government is that: It never passed on the benefit of LOW crude oil prices internationally to the people.

The final consumer, like you and I, kept buying petrol, diesel and LPG at even higher prices than we used to before 2014. For example, today we are purchasing petrol at around Rs. 75 across India. At one point of time in January 2018, the prices touched Rs. 80.

Many Newspapers and TV News Channels today are attributing this price increase in India to the increase in crude oil prices Internationally. But for their information, the retail oil prices were not low even when crude oil prices internationally were low. Have a look at the International Crude Oil prices in the last four years:

Average annual OPEC International crude oil price from 2014 to 2018 (in U.S. dollars per barrel)

Average annual OPEC International crude oil price from 2014 to 2018 (in U.S. dollars per barrel).

So no one must argue that the increase in retail petrol and diesel prices today, is due to increase in crude oil prices internationally.

In contrast the international crude oil prices were at a much higher level during Congress led UPA Government. But even then the retail prices of petrol and diesel were below than what they are today. Have a look at the chart below:

International crude oil prices 2008-2013

Average annual OPEC International crude oil price from 2014 to 2018 (in U.S. dollars per barrel)

To conclude, it is still a puzzle as to why Modi Government never passed on the benefit of low international crude oil prices to the consumer. When the charts show, it could!

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