On Tuesday, petrol cost Rs 79.48 per litre in Mumbai and Rs 70.38 per litre in Delhi while diesel was priced at Rs 62.37 per litre in Mumbai and Rs 58.72 per litre in Delhi.
The news reports brought back the ghosts of the era of regulation, when petrol and diesel price movements were much hyped events with the government dictating how much the oil refining and marketing companies could charge. Terming the criticism of a spike in rates as unfair, he said the drop in prices for over a fortnight after the daily price revision was introduced has been ignored and only the "temporary" phenomenon of a rising trend was being highlighted. "Petrol and diesel prices in the country are benchmarked to the worldwide price of these commodities", Pradhan said speaking to journalists after a meeting in New Delhi to review the daily petrol and diesel pricing regime.
Defending hike in fuel prices, Mr Pradhan said that world refining capacity has come down by 13 per cent due to hurricane in United States of America due to which in last three months worldwide petrol prices have jumped by 18 per cent and diesel by 20 per cent.
"The government will not interfere in the day-to-day functioning of the OMCs... for the last three years, the pricing mechanism has been linked to the market", he said.
He claimed that hurricanes Harvey and Irma, which hit the United States over the past month, were responsible for the rise in fuel prices in India.
Daily revision allows any fall in global oil rates to be passed on to consumers immediately rather than having to wait for 15 days as in the old system, he added. The price of petrol rose by 18% and that of diesel has gone up by 20% in the global market over the last three months, he said.
The government is under tremendous political pressure as fuel prices are hovering around three years high in some parts of the country despite global crude oil prices almost half of what they were in 2014.
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