Petrol price drops to Rs 86.97 (down by 4.37), diesel to Rs 77.45 (down by 2.65) in Mumbai after tax cut

After six weeks of incessant hikes, prices of petrol and diesel in Mumbai took a serious nosedive on Friday thanks to the Centre and State’s decision to cut taxes on fuel prices.

According to a price listing on Indian Oil Corporation (IOC), the cost of petrol dropped to Rs 86.97 per litre and diesel fell to Rs 77.45 per litre in Mumbai today.

While petrol price came down by Rs 4.37, from the previous high of Rs 91.34, diesel fell by Rs 2.65 from the record high of Rs 80.10. Both fuels had breached their highest-ever mark on Thursday.

Meanwhile, in Delhi, petrol was retailing at Rs 81.50 and diesel at Rs 72.95 today.

The reduction in prices comes in the backdrop of the Centre and State’s decision to cut taxes in a bid to alleviate the burden of rising fuel costs.

Yesterday, Union Finance Minister Arun Jaitley announced a cut in petrol and diesel prices by Rs 2.50 per litre, factoring in excise duty reduction of Rs 1.50 per litre and oil companies absorbing a reduction of Re 1 per litre.

Shortly after, Maharashtra Chief Minister Devendra Fadnavis announced a similar cut in the prices of petrol and diesel by reducing the sales tax and VAT levied on fuels.

Apart from Maharashtra, several other BJP-ruled states like Gujarat, Madhya Pradesh, Uttar Pradesh, Chhattisgarh, Jharkhand, and Tripura also announced a similar reduction in taxes.

Fuel prices in the country had been on the rise since mid-August, which the Narendra Modi-led government had attributed to soaring global crude oil prices and international factors like the dip in rupee value against the US dollar.

Before this, the Centre had cut excise duty by Rs 2 per litre on petrol and diesel in October last year amid the surge in crude oil prices.