India to Announce Adjusted Fuel Prices, Hikes in Diesel and Kerosene Expected

The federal government is preparing to announce the results of its periodic review of fuel prices, with potential adjustments to petroleum prices across the country set to take effect on December 31. The proposed changes are based on global market trends and domestic economic considerations, with diesel and kerosene oil prices facing potential increases, while petrol prices are expected to remain unchanged.

Reports suggest that diesel prices are likely to rise by over Rs4 per liter, and kerosene oil prices might increase by Rs1 per liter. This development has implications for transport sectors, including small vehicles and two-wheelers used for private transportation. With middle- and lower-middle-class individuals set to bear the brunt of the increase, everyday expenses are likely to go up. Moreover, industries that rely heavily on high-speed diesel, namely heavy transport vehicles, trains, and agricultural equipment, will be significantly affected, potentially leading to a hike in food prices. The Centre has kept petrol prices unchanged, a move that will also be announced on December 31. The Ministry of Petroleum will provide the final prices at the start of the new year.

Industry experts predict the price adjustment may impact global sentiments, particularly due to ongoing geopolitical tensions in the region, which could have far-reaching consequences for global petroleum prices and economies. According to experts, the transition in the US leadership has also caught the attention of the global oil market, potentially further disrupting oil prices. Overall, forthcoming price adjustments, including a hike in diesel and a cut in petrol, suggest the need for the Indian population, including middle- and lower-middle-class individuals, companies, and farmers, to prepare for the shifting economic climate.

If the pricing adjustments materialize, it will be the second fuel price revision this month, after pkg on December 15, where petrol prices remained steady, and HSD was cut by Rs3.05 per liter. The upcoming price adjustments are set to affect major transport sectors, industrial operations, and micro-economic dynamics in a country heavily reliant on fuel for transportation and power generation. Careful monitoring and adaption to the shifting global economic trends will become essential to mitigate potential economic shocks following the price adjustments.