NEW DELHI: State-run fuel retailers don’t tire of flashing their “autonomy” to justify raising petrol price. But when it came to a reduction on Thursday, they suddenly appeared to have developed political bones: the three oil marketers firms hastily pulled back plans to cut price by Rs 1.60 or so, excluding taxes, to prevent the opposition from taking credit.

The retailers had raised petrol price by Rs 6.28, excluding taxes, on May 23. The heads of oil marketing firms and the government predictably justified the steepest-ever increase. But they also held out hope of a sharp cut on June 1, citing emerging price trends in Singapore bulk market for crude and gasoline – trade name for petrol.

Broadly, oil marketers review prices on the 15th and last day of each month. Petrol price is arrived at by calculating the average Singapore price of gasoline in the preceding fortnight and the rupee’s exchange rate against the dollar.

According to oil ministry data, the average benchmark gasoline price declined to $114-115 a barrel in the second fortnight from $124 in the first fortnight of May — which was used to jack up the price. Crude too has declined to $106-107 a barrel from $111. The dollar exchange rate averaged Rs 54.96 against Rs 53.77. Here’s how the math works: Every $1 rise in crude price impacts fuel price by 33 paise and every rupee fall in dollar exchange rate needs pump prices to be raised by 77 paise.

No wonder, during the fortnightly review, enough room was found to reduce petrol price by Rs 1.60 or so. Even Bharat Petroleum chairman R K Singh at one point appeared on TV saying petrol price would be cut by Rs 1.60 or so. R S Butola, chairman of market leader IndianOil Corporation, was away on leave and unavailable for comment.

Oil company executives gave the lame-duck excuse of dollar’s marginal appreciation for deferring the cut. But government sources said no sooner had a cut become certain, the company brass received a signal from the ministry to hold their horses. Other officials said the ministry had told the oil companies to defer the cut much earlier.

But both versions have a common argument: Reducing the price on the day of the bandh, or even a day or two after the routine date, could make the government look like it had succumbed to opposition pressure.

Government sources said the oil companies were now likely to reduce the price sometime in the middle of next week. But given the rupee’s continued slide against the dollar, there may not be much room. “Even if there is a reduction, not reducing the price on Thursday means consumers would be paying more than they should for the next few days,” an executive said on condition of anonymity.