Union Budget 2022: Petrol, Diesel prices to go up? Know here

In another blow to common man, the Union Budget 2022 will significantly affect the prices of petrol and diesel.

The Union Budget proposed by the government on February 1 has proposed to impose additional excise duty on petroleum products sold without a blend of ethanol or biodiesel.

Post this, the prices of diesel are likely to rise in most parts of the country. Diesel might go up to Rs 2 per litre from October 1, 2022.

As per the Union Budget 2022, prices of petrol may also rise in some areas like the North-East.

Ethanol is mixed in petrol

Ethanol, which is extracted from sugar cane, is added to petrol only in the ratio of 10 per cent. This blending has been approved to reduce the dependence on oil imports and provide an additional source of income to farmers.

Over 75-80 per cent of the country gets ethanol-blended petrol even today.

Biodiesel extracted from non-edible oil seeds

Diesel is blended with biodiesel extracted from non-edible oil seeds.

Considering the large-scale usage of diesel in the agriculture and transport sector, budget 2022’s additional excise duty on unsubstantial fuels may increase the prices of petrol and diesel.

Sources in the petroleum industry believe that the government’s decision will encourage oil companies to mix ethanol in petrol as there is less chance of setting up a structure for the purchase of biodiesel in eight months.

While there is not much that has changed from last year’s Union Budget for the salaried class and common man in the country, the changes in excise duty are likely to impact at large.