Will Fuel Go Back to Dynamic Pricing in India? | World Business Watch | WION

Added: 2026-05-18

[00:00:00]Moving on, let's shift the focus to India. The four-year freeze on retail fuel price hikes has now shattered.

[00:00:06]Experts say the rupee 3 rupee per liter hike has barely scratched the surface of a deeper energy crisis.

[00:00:13]With the West Asia war pushing Brent crude past $100 per barrel for over 75 days now, state-run oil marketing companies or OMCs are bleeding an estimated 1,000 crore rupees daily.

[00:00:26]Because of this, the critical question isn't whether prices will rise again, but how they will be calibrated.

[00:00:34]Reports suggest to survive, OMCs will be forced to choose between transitioning back to daily dynamic pricing or executing steep fortnightly reviews.

[00:00:44]If the government permits OMCs to resume daily dynamic pricing, consumers will face an eroding wallet.

[00:00:51]Analysts estimate that OMCs still suffer a massive under-recovery of 11 rupees to 14 rupees per liter even after the initial adjustment.

[00:01:01]Daily adjustments of 30 to 50 paise would quietly absorb the deficit over a month, preventing sudden market panic, but masking a relentless upward trajectory.

[00:01:13]Alternatively, if the government retains administrative control and switches to fixed fortnightly or monthly reviews to manage economic panic, the sticker shock will be more brutal instead of minor daily shifts. Consumers would face abrupt jumps of 4 rupees to 5 rupees per liter at the end of each cycle.

[00:01:33]Under this mechanism, if global crude remains above $105 alongside a weak rupee, retail petrol in Delhi could quickly breach 110 rupees to 115 rupees per liter.

[00:01:45]While diesel could easily search past the 102 rupees per liter mark within two quarters.

[00:01:51]So, for those wondering if the 3 odd rupee hike was the last one, the disappointing answer is no.

[00:01:58]A 3 rupees bump only covers a fraction of the actual input cost search.

[00:02:04]For the consumer, whether the rain arrives in a daily drip or a bi-weekly hammer blow, the reality remains same. Pump prices could head significantly higher.