The Petrol Price Hike in India: Understanding the Hurdles and Future Outlook

Introduction to Petrol Price Hikes in 2021

In 2021, India faced a series of petrol price hikes that significantly impacted both consumers and the broader economy. These increases were partly due to rising global crude oil prices and additional taxes imposed by the central and state governments. The hikes continued throughout the year, reaching record highs in several states.

Reasons Behind the Hikes

The skyrocketing petrol prices in India during 2021 can be mainly attributed to two key factors:

Rising Global Crude Oil Prices: The global demand for oil drives the global market prices, which directly impacts the cost of petrol in India. Additional Taxes: The Indian government, along with state governments, levied excise duties and other taxes, further contributing to the final price consumers pay at the pump.

Renewed Relief in November 2021

Amid growing public concern and frequent protests, the Indian government made a significant move in November 2021 by reducing the excise duty on petrol and diesel. This decision aimed to provide much-needed relief to consumers struggling with rising fuel costs and inflation.

The Complex Issue of Vehicle Count

The entire uproar around fuel price hikes may not be as straightforward as it initially appears. India is already witnessing a severe traffic congestion issue, as evidenced by the substantial number of vehicles on its roads. Even with cheaper fuels and cheaper cars, the capacity of the roads is exceeded, suggesting that public transportation, particularly trains, offer a more sustainable solution.

Specific Petrol and Diesel Prices in May 2021

City Petrol Price (Rs per litre) Diesel Price (Rs per litre) Delhi 85.38 94.49 Kolkata 88.23 94.50 Chennai 90.12 95.99 Mumbai 92.69 100.72

The uniformity in crude oil rates is another significant factor contributing to the ongoing issue. The OPEC (Organization of the Petroleum Exporting Countries) discussions with its allies have led to more consistent crude oil rates, which in turn affects the pricing of petrol and diesel in India.

The Future Outlook

The hikes in petrol prices might continue until people take significant actions. Public protests and sustained pressure on the government are necessary to address this critical issue. In the long term, more emphasis should be placed on promoting public transportation and other eco-friendly options to ease the burden on India's already strained road system.

It is also essential to monitor OPEC's decisions and global oil market dynamics to understand their impact on future fuel prices in India.