Diesel Price
Diesel rate is to be cut by ₹1/litre and petrol by ₹1.75.Reuters File

Diesel and petrol prices in the country are likely to be cut down by a margin of ₹1 and ₹1.75 per litre respectively, after a period of five years, as international oil rates have gone down.

The government and oil industry sources have stated that state-owned oil firms will announce a reduction in diesel and petrol prices, possibly after two weeks.

The last reduction in diesel and petrol rates were made in January 2009. India has been witnessing price hikes each year since then, while in 2013 the UPA government regulated diesel prices by declaring a monthly rise in the price by 50 paise, in order to cover up losses.

The reduction became possible as the difference between import cost and retail price of the oil, which was earlier going in loss, turned its course to make profits since 16 September, as international oil prices started to soften.

"It (government) wants to reduce diesel price to protect state-owned oil companies' market share, which may be lost to private retailers who would be selling diesel in tandem with international prices," The Economic Times reported.

Oil minister Dharmendra Pradhan has reportedly informed Prime Minister Narendra Modi about the reduction in oil rates.