Stability in Fuel Prices Marks Economic Resilience in Chennai
In Chennai, petrol and diesel prices remain consistent for over a year and a half, signaling a period of unusual stability in a volatile market.
Jordan Taylor
- 2023-12-29
- Updated 11:34 AM ET
(NewsNibs) - Amidst a global backdrop of fluctuating energy prices, Chennai's petrol and diesel costs have defied trends by maintaining a standstill price point for an impressive 19 months. As of December 29, the price of petrol in the southern Indian metropolis is steady at ₹102.63 per liter, with diesel tagged at ₹94.24 per liter. This static pricing phase has endured for an unprecedented 587 consecutive days, offering a rare pocket of predictability for the local economy and consumers alike.
Economic Relief Through Government Intervention
The Covid-19 pandemic wrought widespread economic hardships, with lockdowns in 2020 and 2021 heavily impacting the public. In response to these challenges, the Indian government took decisive action on November 4, 2021, slashing petrol prices by ₹5 and diesel prices by ₹10. Consequently, petrol and diesel prices in Chennai were adjusted to ₹101.40 and ₹91.43 per liter, respectively. Further relief came on May 22 with excise duty cuts leading to a petrol price decrease by ₹8 and diesel by ₹6, underpinning the government's commitment to mitigating financial strain on its citizens.
The National Biofuel Policy and Ethanol Blending Goals
As part of a long-term environmental and economic strategy, the Indian government launched the National Biofuel Policy in 2018, aiming for a significant milestone of 20% ethanol blending in petrol by the year 2030 – a target that was ambitiously brought forward to 2025. In alignment with this goal, India's Minister for Petroleum and Natural Gas, Hardeep Singh Puri, anticipated that 20% ethanol-blended petrol would become available by December 2022 or January 2023. To achieve the 2025 target, the country requires 1,000 crore liters of ethanol; currently, 450 crore liters are in production with tenders issued for an additional 400 crore liters.
This prolonged period of stable fuel pricing in Chennai presents a unique case study in market steadiness amidst ongoing economic recovery efforts post-pandemic. It also underscores the Indian government's proactive stance on energy policy with its pursuit of sustainable biofuel integration, which aims to not only diversify energy sources but also align with global environmental imperatives.
