Foreign Exchange hits petrol price reduction

Following the petrol price falling to the lowest at $34.39 a barrel in 11 years in the international market, the people had high hopes of a drastic reduction of petrol price by as much as Rs.3-4. But the reduction by a mere half-a-rupee has dampened the spirits of the travelling public. Economists attribute the meagre reduction to the foreign exchange rate and the rupee fall against the dollar. Another reason for the smaller reduction is imposts on petroleum imports, which are always seen to be rising. The Central government is raking in more and more revenue through the imposts on imports. These are not passed on to the customers, although the price structure of petrol is directly linked to international petroleum prices. The economists, however, give the assurance that if the rupee gains against the dollar, petrol prices would fall rapidly in the country.