Petrol price has gone up once again. There is no good reason for the hike. It is a myth that oil marketing companies decide the hike. When there were elections in four states and one union territory petrol price did not go up. The hike happened after voting was over. That time LPG price also went up.
On 25/6/2010 the government of India increased prices of petrol by Rs.3.50, diesel by Rs.2/- kerosene by Rs.3/- per litre and LPG by Rs.35/-per cylinder. Petrol and diesel prices were decontrolled.
The increase has come at a time when food price inflation is about 18%.
The increase was avoidable. For the week ended 18/6/2010 foreign exchange reserves increased by $3 billion. If the government had not increased foreign exchange reserves the dollar value would have gone down making oil import cost less and there would have been no need for price increase.