Petrol and diesel prices were hiked by 80 paise a litre each on Friday, the third increase in four days as oil firms recoup losses from holding rates during the period prior to the recently-concluded assembly elections.
Petrol in Delhi will now cost Rs 97.81 per litre as against Rs 97.01 previously while diesel rates have gone up from Rs 88.27 per litre to Rs 89.07, according to a price notification of state fuel retailers.
The increases are the steepest single-day rise since the daily price revision was started in June 2017.
With three increases beginning March 22, petrol and diesel prices have gone up by Rs 2.40 a litre.
A record 137-day hiatus in rate revision ended on March 22 with an 80 paise per litre increase in rates and similar proportion hikes have followed in subsequent days.
Prices had been on a freeze since November 4 ahead of the assembly elections in states like Uttar Pradesh and Punjab -- a period during which the cost of raw material (crude oil) soared by USD 30 per barrel.
The rate revision was expected soon after assembly elections ended on March 10 but it was put off.
Oil companies are now recouping the losses.
Moody's Investors Services says fuel retailers IOC, BPCL and HPCL together lost around USD 2.25 billion (Rs 19,000 crore) in revenue for keeping petrol and diesel prices on hold during elections in five states.
Oil companies "will need to raise diesel prices by Rs 13.1-24.9 per litre and Rs 10.6-22.3 a litre on gasoline (petrol) at an underlying crude price of USD 100-120 per barrel," according to Kotak Institutional Equities.
CRISIL Research said a Rs 9-12 per litre increase in retail price will be required for a full pass-through of an average USD 100 per barrel crude oil and Rs 15-20 a litre hike if the average crude oil price rises to USD 110-120.
India is 85 per cent dependent on imports for meeting its oil needs and so retail rates adjust accordingly to the global movement.