Crude oil prices in the international market posted its worst week (24 Jan ending) since July over the fear of coronavirus outbreak across the globe affecting demand. Petrol and diesel prices in India have already fallen by up to Rs 1.5 per litre in over 10 days.
On Saturday, petrol prices per litre were lowered to Rs 74.16 in New Delhi, Rs 76.77 in Kolkata, Rs 79.76 in Mumbai and Rs 77.04 in Chennai.
Diesel prices per litre were cut to Rs 67.31 in New Delhi, Rs 69.67 in Kolkata, Rs 70.56 in Mumbai and Rs 71.12 in Chennai.
As of Friday, the death toll due to the Virus in China rose to 41 with 1287 confirmed cases, China's National Health Commission announced on Saturday.
Hong Kong has declared a virus emergency in the city, extending school cancellations until 17 February and canceling all official visits to mainland China. Flights and high-speed train journeys between Hong Kong and the Chinese city of Wuhan will be halted.
As the flu-like coronavirus spreads, markets fear a slowdown in oil demand and economic growth in China, the world's largest oil importer. China is also the second-largest oil consumer, just behind the US.
International crude benchmark Brent fell by 2.2 percent on Friday to settle at $60.69, bringing its weekly loss to roughly 6.4 percent. It has been the third straight week of decline in oil prices.
More than 33 million people are under travel restrictions in China, which is expected to impact jet fuel demand.
Further, the timing is especially important because of the Chinese New Year, that began on Saturday and is known as the world's largest annual human migration.
With shutdowns in public transport and travel restrictions, theoretically, the economic activity will be reduced, impacting demand for fuel.
Retail price of fuel sold in India is based on global oil rates and rupee's valuation. A decline in international prices will benefit consumers in the country.