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India hikes petrol price by Rs1.63

The IOC said it had to hike prices due to volatility in the rupee against the dollar and hardening of international motor spirit prices.

The Indian rupee has lost more than 25 per cent against the dollar since the beginning of the financial year.

Currently, the partially-convertible rupee stands at Rs63.36 against the dollar. It had touched a record low of 68.80 to a dollar on August 28.

Any volatility in the rupee's value effects India's ability to import crude oil. Currently, India imports almost 79 per cent of its crude oil requirements.

The IOC said it will reduce petrol prices if rupee-dollar exchange rate and international motor spirit (MS) prices stabilise.

'The movement of prices in the international oil market and rupee-dollar exchange rate are continuously under watch and developing trends reflected in future price changes,' it said in a statement.

The three state-owned oil marketing companies had last raised prices of petrol and diesel by Rs2.35 and Rs0.50 a litre September 1.

In Delhi, the petrol price would increase to Rs76.06 per litre. In Mumbai, Chennai and Kolkata, petrol would now be priced at Rs83.62, Rs79.55 and Rs83.63 per litre.

The government had deregulated petrol prices in June, 2010. However, it subsidies the retail selling prices of diesel, kerosene and cooking gas to insulate domestic users from the impact of a rise in international oil prices and to contain domestic inflationary conditions.