Context: Recently, the price of diesel in New Delhi surpassed the price of petrol for the first time. 

More on News: 

  • Diesel was priced at  Rs 79.88 even as the price of petrol was at Rs 79.76 in Delhi however the same trend was not observed in any other state.

Factors Contributing to it:

  • Oil Marketing Companies increased the price of Diesel more than the price of petrol in the last few days.
  • Delhi Government increased VAT(Value Added Tax) on both petrol and diesel to 30%, earlier it was 27%  for petrol and 16.75% for diesel.
    • While other states have also hiked levies on both petrol and diesel but maintained lower tax rates on diesel than on petrol leading to the price of diesel remaining below the price of petrol.
  • An additional Air Ambience levy of Rs.250/kilolitre is also imposed on diesel.
    • Govt. of Delhi imposes cess on diesel of Rs 0.25 per litre on sale of diesel in NCT of Delhi to create a separate fund called Air Ambience Fund.


  • As per experts, there is very little difference between international prices of petrol and diesel, leading to taxes becoming the key component maintaining a price difference between petrol and diesel. 
  • International prices of both diesel and petrol are rising due to increasing demand by countries after their lockdowns which has led to Brent crude has reached around $42/barrel from earlier below $20 mark.

Brent Crude:

  • It may refer to any or all of the components of the Brent Complex, a physically and financially traded oil market based around the North Sea of Northwest Europe.
  • Brent is the leading global price benchmark for Atlantic basin crude oils. 
  • It is used to set the price of two-thirds of the world's internationally traded crude oil supplies. 
  • It is one of the two main benchmark prices for purchases of oil worldwide, the other being West Texas Intermediate (WTI).


https://indianexpress.com/article/explained/explained-how-diesel-has-become-more-expensive-than-petrol-in-delhi-6474454/#:~:text=Diesel also attracts an additional,levy of Rs 250/kilolitre.&text=According to experts, there is,difference between petrol and diesel.

Image Source: Indian Express