Oil companies had absorbed the losses, kept retail prices steady
As global oil markets convulsed under the weight of war and geopolitical uncertainty, the people of Delhi-NCR felt the tremor in the most immediate way — at the fuel pump, before dawn. A modest rise in CNG prices, driven by crude oil approaching thirteen-year highs, signals not just an economic adjustment but the moment when distant crises arrive at the doorstep of those with the least margin to absorb them. The freeze on petrol and diesel prices, held steady through the rhythm of elections, cannot hold forever — and those who drive for a living already sense what is coming.
- Brent crude surged toward $139 per barrel — a thirteen-year high — as fears of a Russian oil ban and stalled Iran nuclear talks squeezed global supply with no relief in sight.
- Delhi-NCR's CNG prices jumped overnight, hitting taxi drivers, auto-rickshaw operators, and delivery workers whose thin margins leave almost no room to absorb even fifty paise more per kilogram.
- Petrol and diesel prices have been artificially frozen for over four months, with oil companies quietly absorbing mounting losses while five state elections — including Uttar Pradesh — kept political pressure on the pump.
- With voting nearly concluded, market experts and industry insiders are signaling that a sharp correction in petrol and diesel prices is no longer a question of if, but when.
- Government officials offered only careful, non-committal language — a decision 'in due course,' an appeal to public understanding — the unmistakable sound of a reckoning being postponed, not avoided.
On a Tuesday morning in March, commuters across Delhi and the NCR region found CNG prices had risen — fifty paise per kilogram in the capital, a full rupee in Noida, Greater Noida, and Ghaziabad, where prices climbed to Rs 59.58 per kg. The change appeared quietly on the pumps of Indraprastha Gas Ltd, but its origins lay thousands of miles away.
Brent crude had approached $139 per barrel — a level unseen since July 2008 — driven by fears of a Russian oil ban and delays in reviving the Iran nuclear deal. India, which imports eighty-five percent of its oil, had no domestic cushion. Its energy basket had already climbed to over $111 per barrel, and every dollar of global price movement eventually finds its way into ordinary lives.
For taxi drivers and auto-rickshaw operators, the hike was immediate and personal. These are businesses built on narrow margins, where a small daily increase in fuel costs can quietly erase a day's earnings.
Petrol and diesel prices, meanwhile, had been held frozen for more than four months — a political decision tied to assembly elections across five states. Oil companies absorbed the losses in silence. But that silence had a cost, and industry insiders made clear that once the elections concluded, prices would rise to recover it.
Government officials offered little beyond careful reassurance — a decision would come 'in due course,' people would be informed when the time was right. It was the language of delay. The CNG increase was, in the eyes of market observers, a preview: a small adjustment before the larger reckoning that ordinary commuters, already watching the pumps, could feel approaching.
On Tuesday morning, commuters across Delhi and its surrounding cities woke to find the cost of compressed natural gas had jumped by fifty paise per kilogram. In the capital itself, CNG climbed to Rs 57.51 per kg, up from Rs 56.51. In Noida, Greater Noida, and Ghaziabad, the increase was steeper—a full rupee per kilogram, pushing prices to Rs 59.58. The change was immediate and visible on the pumps operated by Indraprastha Gas Ltd, the company that supplies CNG and piped cooking gas across the region. Mumbai, by contrast, saw no change; CNG there remained at Rs 66 per kg, a reminder that fuel costs move differently depending on local taxes and supply chains.
For the people who depend on CNG most—taxi drivers, auto-rickshaw operators, delivery workers—the timing was brutal. These are thin-margin businesses, and every fifty paise adds up across a day's worth of refueling. The price hike was not arbitrary. It was a response to something happening thousands of miles away, in the global oil markets, where crude had become scarce and expensive.
Brent crude oil had approached $139 per barrel on Monday, a level not seen in thirteen years. The last time prices climbed this high was July 2008, when Brent hit $147.50 per barrel. The current spike was driven by fears that Russian oil would be banned from global markets and by delays in reviving the Iran nuclear deal—both developments that tightened supply at a moment when demand remained strong. By evening, prices had moderated somewhat, with May futures trading around $121.37 per barrel, but the damage to India's energy calculus was already done.
India imports eighty-five percent of the oil it consumes. There is no domestic cushion, no strategic reserve large enough to absorb shocks like this. The Indian energy basket—a blend of Oman, Dubai, and Brent crude—had climbed to $111.61 per barrel as of March 4. Every dollar increase in global crude translates into pressure on domestic fuel prices, and eventually, into the pockets of ordinary people.
Petrol and diesel prices, however, had been frozen for more than four months. Oil companies had absorbed the losses, kept retail prices steady, as five states prepared for assembly elections, including Uttar Pradesh. The political calculation was clear: don't raise fuel prices before voters go to the polls. But that freeze had created a debt. Oil companies were bleeding money, and once the elections concluded, that debt would come due.
A senior executive at one of the three major oil retailers told reporters the company was watching the situation closely, waiting to see whether the spike in crude prices was temporary or permanent. The Ministry of Petroleum and Natural Gas offered little clarity. Rameswar Teli, the minister of state for petroleum, said only that a decision would be made in due course, that people understood oil prices were rising because of the war, and that they would be informed when a meeting took place. It was the language of someone buying time.
Market experts, though, were less circumspect. They believed that once the elections were over, petrol and diesel prices would rise sharply. The CNG increase on Tuesday was a warning shot, a small adjustment before the larger reckoning. For now, the wait continued—a standoff between global markets and domestic politics, with ordinary commuters caught in the middle.
Citações Notáveis
We are watching the situation closely. We need to see if the current spike in international oil prices is a temporary phenomenon or is it here to stay.— Senior executive at one of three oil retailers
People are aware that oil prices are increasing amid the ongoing war. As & when the meeting takes place you will be informed about the prices.— Rameswar Teli, Minister of State for Petroleum and Natural Gas
A Conversa do Hearth Outra perspectiva sobre a história
Why did CNG prices move first, before petrol and diesel?
Because CNG is supplied by a single company, Indraprastha Gas, which can adjust prices more quickly. Petrol and diesel are controlled by the government and oil companies together, and there's political pressure to hold them steady during elections. CNG was the release valve.
So the oil companies are actually losing money right now?
Yes. They've been absorbing the difference between what crude costs globally and what they're allowed to charge at the pump. It's been four months of that. They're waiting for the elections to end so they can recover those losses.
What happens to someone who drives a taxi for a living?
Every fifty paise per kilogram matters. If you fill up ten times a day, that's five rupees a day, fifty rupees a week. It's not much in absolute terms, but it comes straight out of profit on a business that already runs on thin margins.
Is there any chance crude prices come back down?
Possibly. The article mentions prices moderated by evening. But the underlying problem—Russian oil potentially off the market, Iran deal stalled—those are structural issues, not temporary blips. Experts think prices will stay elevated.
So petrol and diesel are definitely going up?
The article stops short of saying definitely, but the logic is clear. Oil companies have losses to recover, elections will be over, and crude prices aren't coming back to where they were. The only question is how much and when.
Why does India care so much about Russian oil?
Because India imports eighty-five percent of what it needs. There's no domestic production to fall back on. When global supply tightens, India has nowhere else to turn.