Petrol price was on Sunday cut by 12 paise a litre and diesel rates by 14 paise across major cities as oil companies moderated rate reduction amid the fall in global prices to absorb the hike in excise duty on fuel by the government.
Petrol in Dimapur now costs Rs. 70.89 per litre, while diesel is priced at Rs. 63.32, according to a price notification of state-owned oil firms. In the state capital, petrol per litre cost Rs.71.73 and diesel Rs. 64 a litre.
According to reports, the reduction in rates would have been higher but for the Rs. 3 per litre increase in excise duty effected on Saturday. Oil companies, they said, had been moderating reduction warranted in retail prices in anticipation of an excise duty hike. The government had on Saturday hiked excise duty on petrol and diesel by a steep Rs. 3 per litre each to garner about Rs. 39,000 crore additional revenue as it repeated its 2014-15 act of not passing on gains arising from the slump in international oil prices. According to a notification issued by the Central Board of Indirect Taxes & Customs, special excise duty on petrol was hiked by Rs. 2 to Rs. 8 per litre and to Rs. 4 a litre from R.s 2 in case of diesel.
Additionally, road cess was raised by Re 1 per litre each on petrol and diesel to Rs. 10. With this, the total incidence of excise duty on petrol has risen to Rs. 22.98 per litre and that on diesel to R.s 18.83. The government had between November 2014 and January 2016 raised excise duty on petrol and diesel on nine occasions to take away gains arising from plummeting global oil prices.