New Delhi: Petrol and diesel prices across major Indian cities remained largely stable on August 5, even as global crude oil markets showed signs of volatility. Brent crude continued to hover around the $80-per-barrel mark, offering some relief after a sharp fall in the previous trading session.
At the global level, Brent crude settled 5.3% lower at $79.36 per barrel on Tuesday, while US benchmark West Texas Intermediate (WTI) declined 5.7% to close at $75.77 per barrel. On Wednesday, prices remained relatively steady, with Brent futures trading marginally higher at $79.13 per barrel.
The recent decline in crude prices followed comments by US Treasury Secretary Scott Bessent, who indicated that a deal to reopen the Strait of Hormuz — a key global oil transit route — could be reached as early as this week. This raised hopes of easing supply disruptions and stabilising global oil markets.
Fuel prices in major cities
Despite fluctuations in global crude prices, retail fuel rates in India showed no major change on August 5. Prices continue to vary across cities due to differences in state taxes and local levies.
Petrol prices
- New Delhi: ₹102.12 per litre
- Kolkata: ₹113.43 per litre
- Mumbai: ₹111.12 per litre
- Chennai: ₹107.75 per litre
- Hyderabad: ₹115.69 per litre
- Bengaluru: ₹110.93 per litre
Diesel prices
- New Delhi: ₹95.20 per litre
- Kolkata: ₹99.78 per litre
- Mumbai: ₹97.78 per litre
- Chennai: ₹99.57 per litre
- Hyderabad: ₹103.82 per litre
- Bengaluru: ₹98.79 per litre
Impact of global crude trends
India imports more than 85% of its crude oil requirements, making it highly sensitive to global price movements. Any sustained increase in crude oil prices can significantly raise the country’s import bill and widen the current account deficit.
Higher crude prices also tend to fuel inflation, as transportation and logistics costs rise, eventually impacting the prices of essential goods and services. Conversely, a decline in global oil prices can provide some relief, although the transmission to retail fuel prices may not always be immediate.
What determines fuel prices in India?
While global crude oil prices remain the most important factor, several domestic elements influence petrol and diesel rates in India. These include central excise duties and state-level value-added tax (VAT), which vary widely across regions.
Additionally, refining costs, freight charges, dealer commissions and distribution expenses play a role in determining the final retail price. Exchange rate fluctuations, particularly the movement of the Indian rupee against the US dollar, also have a direct impact, as crude oil is traded globally in dollars.
Outlook
Although global oil prices have softened slightly in recent sessions, uncertainty remains due to geopolitical developments and supply concerns. Any breakthrough in reopening critical shipping routes like the Strait of Hormuz could stabilise prices further.
For Indian consumers, however, fuel prices are likely to remain sensitive to both global trends and domestic tax policies. In the near term, stability in crude prices around the $80 mark may help prevent sharp increases, but sustained relief will depend on broader market conditions and policy decisions.