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Mumbai to be the first metro to see petrol selling for Rs 100? – Times of India

NEW DELHI: Will India’s financial capital, Mumbai, become the first metropolis in the country to see regular petrol selling for Rs 100 a litre? Looks like it, if the trend of retailers revising pump prices by tens of paise every second or third day is anything to go by.
After Thursday’s price increase, the 14th this month, petrol shot past the Rs 100-mark in Thane, the first time in Maharashtra, and is just six paise short of the century in Mumbai.
While Mumbaikars are bracing for the impact on their wallets, Jaipur has become the second state capital after Bhopal where petrol price has topped Rs 100. Indeed, the state earned the dubious distinction of seeing petrol price cross Rs 100 per litre for the first time in the country at Sri Ganganagar on February 17, followed by Bhopal in Madhya Pradesh.
Rajasthan has the highest VAT on fuels, followed by Madhya Pradesh and Maharashtra. This explains the surge in petrol price in these states, although the fuel is selling well above Rs 90 per litre in all other states.
The difference in the cost of transporting fuel from the source – refinery or supply depots – to pumps in a district causes prices to vary within a state. Octroi or entry tax in some cities is another reason for such variation.
Since January, petrol price has risen about 11%, or Rs 9.60 a litre in Mumbai and Rs 9.97 in Delhi. Diesel has become costlier by roughly 14%, or Rs 11.36 a litre in Mumbai and Rs 10.74 in Delhi as retailers passed on the impact of rising international crude price and a weakening rupee.
Pump prices had remained static between February 28 and May 3 when the retailers paused revisions during electioneering in five states, even though crude hit $70/barrel during this period. Crude is currently hovering around $68, boosted by demand from the US, western Europe and China.
The high Central taxes and VAT are amplifying the impact of elevated crude. The Centre raised excise duty by Rs 13 on petrol and Rs 16 on diesel between March and May last year when oil prices collapsed due to the pandemic. The two hikes raised excise duty 65% on petrol from Rs 19.98 to Rs 32.98 a litre and 79% on diesel from Rs 15.83 to Rs 28.35. VAT adds to the pinch since it is levied as a percentage and rises each time the base cost goes up.