Passenger Vehicle sales in India has witnessed negative growth in some of the past months and the increase in fuel prices was one of the major reasons behind it. Now that prices have neutralized to quite an extent in last few days, the sales are again expected to be back on the growth track. Petrol and diesel prices have been reduced on Sunday by ₹ 20 paise and ₹ 18 paise respectively. The per litre price of petrol in Delhi was reduced to ₹ 70.17 per litre from ₹ 70.37 per litre and the price of diesel was reduced to ₹ 64.10 per litre from ₹ 64.28 per litre. Along with Delhi, prices were also reduced in other metro cities like Mumbai, Chennai and Kolkata.
Commenting on a series of reduction in the fuel prices, Sugato Sen, Deputy Director General, Society Of Indian Automobile Manufacturer (SIAM) said, "Fuel prices have been one of the factors affecting car sales in past months. Now that it is coming down, there should be an offset in the impact and car sales should increase by some margin as we hope customer sentiments to improve." In November, car sales were down by 3.43 per cent at 266,000 units compared to 275,440 units in the same period last year.
The reduction in prices of petrol and diesel is the result of a decline in global crude oil prices. Oil retailers use a complex formula comprising a 15-day average of crude oil price and the exchange rate of the rupee against the US dollar to compute the daily retail price of petrol and diesel. On Friday, oil prices fell to their lowest since Q3 2017. Brent crude fell 53 cents, or nearly 1 per cent, to settle at $53.82 a barrel, after falling during the session to $52.79 a barrel, the weakest since September 2017.