Petrol price was today cut by Rs 2 per litre and diesel by Rs 0.50 a litre, the third reduction in rates this month on fall in global oil rates.
The new rates will be effective midnight tonight, said Indian Oil Corp (IOC), the nation's largest fuel retailer.
Price of petrol in Delhi has been cut by Rs 2 per litre, including local levies, and will cost Rs 61.20 per litre from tomorrow as against Rs 63.20 currently.
A litre of diesel will cost Rs 44.45 as compared to Rs 44.95 currently. Oil firms had last cut petrol price by Rs 1.27 a litre and diesel by Rs 1.17 per litre with effect from August 15. Prior to that, rates of petrol were cut on August 1 by Rs 2.43 a litre and that of diesel by Rs 3.60.
"Since last price change, there has been a decrease in international prices of both petrol and diesel. However, Rupee-US Dollar exchange rate has depreciated during this period. The impact of both these factors warrants a downward revision in prices, the impact of which is being passed on to the consumers with this price decrease," IOC said in a statement.
Last month, the price of petrol was cut on July 1 by 31 paise per litre and diesel by 71 paise a litre. This was followed by a Rs 2 per litre cut in rates of both petrol and diesel, excluding local sales tax, from July 16 but consumers in Delhi were deprived of the benefit as the Delhi government raised VAT.
As a result, petrol price in Delhi went up by 28 paise a litre after hike in VAT or sales tax on the fuel from 20 to 25 per cent.
Rates of diesel, on which VAT was raised from 12.5 per cent to 16.6 per cent, saw a smaller reduction of 50 paise per litre.
"The movement of prices in international oil market and INR-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price changes," IOC said.