Petrol price may be cut by about Rs 1.60 per litre laterthis month as appreciation of rupee against the US dollar has helped statefirms make profit on the fuel.
Indian rupee appreciated to five-month high since thegovernment announced allowing foreign direct investment (FDI) in multi-brandretailing. This has eased the cost of imports for oil firms, helping them makeprofit on sale of petrol.
"Yes, there is about Rs 1.60 per litre profit on petrolsince October 1. But we want this trend to stabilise before we think of cuttingretail prices," a senior executive at one of the three state-owned fuelretailers said.
Petrol price was last revised on July 24 when it was raisedby 70 paise to Rs 68.48 per litre in Delhi. It was last cut on June 3 whenrates were reduced by Rs 2.02 per litre.
The current profit is mainly on account of strengthening ofrupee -- from Rs 55.58 to a US dollar average in the second half of August toRs 54.12 last fortnight.
Also, the price of international gasoline, against which thedomestic retail prices are benchmarked, have eased from USD 126.11 per barrelto USD 122.31.
Together, these have helped oil firms, which lost about Rs6,000 crore in revenue on selling petrol below cost this fiscal, make profits.
Rupee has further appreciated to Rs 52.28, which wouldfurther give then scope for a price cut.
"We are committed to passing on any gains that we makebut all we are wanting to ensure is that this is not a temporary trend whichcan reverse in near future," the executive said.