Diesel prices surpass petrol in Nepal for the first time

Kathmandu. The price of diesel has exceeded that of petrol. According to the new price rates adjusted by the Nepal Oil Corporation on Wednesday, the maximum price of petrol has been set at 219 rupees per liter, while the price of diesel has reached 237 rupees.

This is likely the first time that the price of diesel has surpassed petrol. Vinitmani Upadhyay, Director of the Nepal Oil Corporation, stated that he was previously unaware that diesel had become more expensive.

Why has diesel become expensive?

Petrol, diesel, kerosene, and aviation fuel are all derived from crude oil. Currently, the conflict in West Asia has driven up the price of crude oil, naturally leading to an increase in these costs.

However, former Deputy Executive Director of the Oil Corporation, Sushil Bhattarai, explains that the primary reason for the rise in diesel prices is the demand side.

Since petrol is relatively used for lighter vehicles and household purposes, demand decreases as soon as prices rise. This is not the case for diesel. Bhattarai notes that because it is used for heavy vehicles and industrial purposes, demand does not drop immediately when prices increase.

Bhattarai further states that following the US-Iran conflict, refineries in West Asia have sustained damage. The inability to source refined oil from unaffected West Asian refineries has also contributed to the price hike.