Diesel Price in Tamil Nadu (25th April 2024)

Today’s diesel price in Chennai is in growth with the comparison with the global crude oil prices. The demand of its requirement is increasing as it is coming as a hint that even after the announcement of OPEC about the good health in oil demand, Saudi Arabia is extending the production of oil for supply by this year's end. This action and to its reaction the price of diesel in Chennai is now Rs.92.24.

Diesel demand in the nation

Like most parts of the nation Chennai is also a rapidly growing city which requires a high fuel consumption on a daily basis. In 2022 it was found that diesel consumption in India was 99 billion liters, now in 2023 it is studied that the number has increased and is now 107 billion liters. This can explain the demand and use of diesel in India. People need more fuels like this to sustain the need for traveling and less time consumption for displacement.

This increasing demand of fuel may result in the increase of expense in India as well development of both refineries and economy of India.

Diesel price in Chennai was revised to Rs 72.97 per litre on Saturday, down by 9 paise from Rs 73.06.

Fuel prices in India are affected by the change in International crude oil benchmarks. Global benchmark Brent was down 1 percent to $76.75 per barrel while WTI fell by 1.8 percent to $65.81. The fall has been from the rise in US oil production which is edging closer to that of Russia. Amid the fall, there have been concerns over the widening gap (premium) between WTI futures and Brent that surpassed $11 on Thursday, marking a new 3-year high.

It has been the fourth day of correction in diesel rates in Chennai. Fuel rates have been down by 21 paise in 4 days. The fall comes after 16 straight days of relentless rise. Diesel rates also impact your daily expenses like grocery shopping as most vehicles used for its transportation run on the same fuel. More relief can only be expected from a cut in central and Tamil Nadu taxes.

Petrol price in Chennai dropped by 5 paise to Rs 73.12 per litre after the daily revision on IOC's (Indian Oil Corporation) website from a fall in international crude oil prices.

Oil prices abroad weighed down after a sudden rise in US crude inventories and on continued expectations on OPEC (organization of the petroleum exporting countries) increasing their output in their June meeting.

Benchmark Brent slipped by 20 cents to $77.30 per barrel while WTI was also down by 20 cents to $68.01 per barrel. The US increased its inventories by 1 million barrels in the last week as per data published by the American Petroleum Institute.

In India, the Kerala state government announced a deduction of Re 1 in the price per litre of petrol and diesel in the state by making a cut on VAT collected on fuel to reduce the burden of consumers. While the central government did not make any attempts to control fuel rates that hit an all-time high last week, Kerala was the first state to take an initiative.

Diesel price in Chennai was lowered by one paise to Rs 73.17 per litre. The decline in international crude oil prices has finally started showing in the fuel rates in India, although quite marginally.

Brent crude was trading at around $75 per barrel on Wednesday, almost $5 lower than its three and a half year high of $80.50 per barrel on May 17. The steep fall was an effect of the news that OPEC and its allies would increase production.

The decision is not finalized and even if it were to, it would take a while before the current deficiencies in supply for crude oil are eased. The international fuel rates are therefore going to hover around $75 per barrel mark for a while.

Italy's political turmoil that has caused the euro to hit a 10-month low, has, in turn, benefited the US dollar, making oil expensive for other currencies.

How diesel prices in Chennai play out in the coming days is hard to predict under such prevailing uncertainties.

In daily revision on Tuesday, diesel price per litre in Chennai was up by 15 paise to Rs 73.18. Fuel prices in India are affected by international crude rates, strength of the rupee and tax rates.

Taxes rates have been consistently high since 2014, on account of social welfare expenses incurred by the central government.

International crude oil rates were mixed today with Brent futures experiencing a marginal hike of 0.28 percent to $75.51 a barrel while WTI fell by 1.64 percent to $66.77 a barrel.

Meanwhile, the rupee weakened against the US dollar in early trade, which is when the daily revision of petrol and diesel prices happens in India. The American currency gained from the reviving hopes of US-North Korea historic summit that is scheduled to take place in Singapore in June.

The easing tensions between the countries have made the dollar attractive to investors, pushing its value further.

Diesel in Chennai was revised to Rs 73.03 per litre after a 12 paise rise on Monday, as per state-owned IOC's website. This is the fifteenth day of hike in the rates. It has increased by Rs 1.44 per litre in a week.

Prices were frozen for 3 weeks prior to May 14, what appeared to be a pre-election strategy.

The losses from the halt were estimated to be Rs 500 crore for oil marketers as during the period the international crude oil benchmarks Brent and WTI were rallying.
On Monday, however, Brent was trading 6.4 percent lower than its month high while WTI was 9.1 percent lower than its peak. They were at $75.09 per barrel and $66.22 per barrel. International rates have been falling since late Friday when Russia and Saudi Arabia said they would increase their output to help stabilize prices in the market. The US, one of the largest oil producers, has also reportedly increased its production.

The hike despite easing prices says that the oil marketers are still recovering from their losses and it would take a while before the diesel rates are stabilized in Chennai as no relief comes from state taxes.

Diesel price in Chennai increased by 16 paise to Rs 72.74 after the daily revision by state-owned oil marketers like IOC.

The price rise was despite the drop in crude oil prices internationally. Russian energy minister said that his country and a group of oil-rich countries will increase their production in the coming days. Following the news, WTI crude fell by 4 percent to $67.88 per barrel from its week's peak of $72.83, while benchmark Brent was down by 3.1 percent or $2.42 to $76.37. It had hit its 3 and a half year high of $80.50 last week.

The rate paid at local bunks for diesel in Chennai is also incidental of high state and central government taxes. The rise in rates is, however, lower than the average hike of 23 paise per litre of diesel this week in the metro city. The price can be expected to ease in the coming days.

Diesel price in Chennai was up by 23 paise per litre in Chennai to Rs 72.58 on Friday. The fuel is being widely used in the metro city by industries and transport companies.

As diesel prices directly influence consumer goods like vegetables, fruits and grocery, the burden will be borne by the resident of Chennai.

International crude oil prices impact fuel rates in India. However, the rates have been eased in global market after Russia hinted on gradually increase its oil output. The oil-rich countries are known to hold production to inflate fuel prices globally.

Indian cities like Chennai are seeing a rise in rates as oil marketing companies are looking to recover from the loss it faced during the 19-day halt in the daily revision of prices 3 weeks ahead of Karnataka elections.

The burden may be eased to an extent when the government steps in to reduce taxes on diesel.

The south-Indian city of Chennai experienced a hike in the price of diesel for the eleventh straight day at Rs 72.35 per litre. It has crossed the Rs 72 mark on 23 May when it was revised to Rs 72.14 per litre.

Diesel price in Chennai is determined by international crude oil rates, processing fee and taxes imposed by the government. As international benchmarks, WTI (West Texas Intermediate) and Brent oil have been high on for a long time now. Brent oil had touched a new high of $80 per barrel last week.

Apart from global rates, taxes like central excise duty and state-specific (Tamil Nadu) VAT (value added tax) and surcharge also add up to the final price you pay at your local bunk in Chennai. Despite fall in fuel prices in 2014, Indian fuel prices were barely affected as they were compensated for high taxes. Now, that both diesel and petrol prices have hit an all-time high across India, protests are being made to bring them under control.

Diesel price in Chennai today was at Rs 71.59 per litre, up by 27 paise from its previous rate of Rs 71.32. The fuel mainly used for long-running vehicles has been on a steady rise in the south-Indian city after the daily revision system that was introduced across Indian oil marketing companies on 16 June 2017. The daily rise in diesel price in Chennai is slightly higher when compared to metro cities like Delhi which saw a 25 paise per litre rise today. This makes the city's increase on a weekly basis more than others.

Apart from international fuel prices, oil processing charges, central excise duty and road cess, state-specific taxes like VAT (value added tax), pollution cess and surcharge imposed by the Tamil Nadu government is also levied on the diesel price you pay in Chennai at your local bunk. Unless the government (central and state) makes some attempts to reduce the burden of taxes on consumers, fuel prices are likely to keep rising in the coming days.