Crude oil was trading at $ 112 when petrol prices touched an all-time high of Rs 76.06 in September 2013. Today, despite the fact that crude oil is cheaper by 28 percent at $80, petrol prices still continue to rise touching the new all-time high level. The comparison clearly suggests that crude oil has not much role to play in high petrol and diesel prices. In fact, it is exorbitant taxes levied by central and state government that is responsible for costly fuel prices in the country.

Data shows that central tax on diesel has increased more than 300 percent while in case of petrol it has jumped by more than 100 percent. To give you an example, dealer price (pre-tax) was Rs 52 per litre in September 2013 when crude oil was hovering around $ 110. But today when crude oil is much cheaper at $80, it costs Rs 37 per litre to the dealer.

Apart from high taxes, the steep rise in dealer’s commission is another reason for the expensive fuel. On May 22, Tuesday, petrol price was at Rs 84.70 per litre in Mumbai while diesel price was at Rs 72.48 per litre. In Delhi, petrol price was at Rs 76.87 per litre while the cost of diesel was Rs 68.08 per litre. In Chennai, the price of petrol was Rs 79.79 per litre while diesel was available at Rs 71.87 per litre. In Kolkata, petrol price went up to Rs 79.53 while diesel cost increased to Rs 70.63 per litre.

Meanwhile, the government has hinted at a cut in excise duty. Petroleum minister Dharmendra Pradhan, said, “The Centre is sensitive towards the rising fuel prices. Various alternatives are being explored. I hope something will work out soon.”