india

Updated: Apr 23, 2020 10:56 IST

While international oil prices have crashed as the world grapples with the unprecedented crisis triggered by the outbreak of coronavirus, Assam has gone against the trend by deciding to hike the retail prices for petrol and diesel.

The state announced an increase in price by nearly Rs 6/litre for petrol and nearly Rs 5 per litre for diesel. A notification in this regard was issued on Tuesday by the state’s finance (taxation) department.

The notification issued by principal secretary Samir Kumar Sinha under the provision of The Assam Value Added Tax Act, 2003, came into effect from 12:00 am on April 22.

Effectively, the price of petrol increased from Rs 71.61 to Rs 77.46 per litre and the price of diesel increased from Rs 65.07 to Rs 70.50 per litre.

The last few days have seen a consistent decline in the crude oil prices in international trading markets. The prices of Brent crude oil, which is bought by India, have crashed to below 2001 levels to reach $16.84 per barrel. It is a dramatic drop from the peak prices of $147 a barrel registered in July 2008.

The oil price hike comes as the state economy reels under the impact of coronavirus and the resultant lockdown, clamped to contain the spread of Covid-19. The flow of funds to the state coffers have dried up significantly as most of the revenue-generating activity remains hampered.

“Due to a decrease in international oil prices, it will affect the amount Assam gets as royalty for oil from ONGC and Oil India Limited. This increase in prices is an attempt to cover some loss, maybe Rs 50 crore in 30 days. This is a temporary measure and there will be a roll-back once the coronavirus crisis gets over,” said Assam finance minister Himanta Biswa Sarma on Wednesday.

Assam earns an average of Rs 166 crores monthly as royalty from the sale of oil. But due to prices coming down that figure would be less than Rs 50 crore per month, said the minister.