Reliance diesel to become dearer

New Delhi: Reliance Industries Ltd (RIL) on Monday increased diesel prices by Rs 2.36 a litre (basic hike of Rs 2 plus increase in taxes), even as the government dilly dallies on allowing public sector oil companies to follow suit.

RIL, the only private sector refiner, took the step 10 days after it increased petrol prices by Rs 2.52 to Rs 2.92. The move, sources said, was prompted by the unprecedented increase in international crude oil price.

With diesel being its highest selling petroleum product, RIL now has a share of about 12-13% in the diesel market. Oil companies were losing about Rs 9 a litre on diesel sales.

RIL directly markets petroleum products through its 1,300 retail outlets (petrol pumps) located mainly on highways. Most of these retail outlets are in Gujarat where its refinery is located.

As a private company, RIL was free to increase the prices of petroleum products even earlier, but with strong competition from PSUs, it could not unilaterally increase prices.