In the biggest-ever price increase of the fuel, state-owned oil companies hiked petrol price by Rs 5 per litre with effect from Saturday midnight.
The steep hike in petrol price is likely to be followed by a Rs 4 per litre increase in diesel rates and Rs 20-25 per cylinder increase in domestic LPG price later this month.
Petrol in Delhi will cost Rs 63.37 per litre at Indian Oil Corporation (IOC) outlets in the national capital from Sunday as against Rs 58.37 a litre currently, an official said here.
Even after Saturday's hike, oil companies will continue to lose Rs 5.50 per litre and another increase in price is on the anvil soon, he said.
"Nothing will happen, no one will do anything, the entire burden is on the common man," said an angry Chandigarh resident.
"It's time to sell of our vehicles," said another.
Bharat Petroleum (BPCL) today hiked price by Rs 4.99 per litre and Hindustan Petroleum (HPCL) by Rs 5.01 a litre. Petrol at BPCL outlets currently costs Rs 58.39 per litre and at HPCL pumps Rs 58.38 a litre.
The increase in petrol price, which the oil firms had been holding since January even though crude oil had touched a two-and-a-half-year high, came a day after election results of five state assemblies were announced.
The government had, in June last year, freed petrol price from its control but oil companies continued to follow 'informal' advice from the oil ministry on rate revision.
The three firms had not raised prices since January in view of Assembly elections in states like West Bengal, Tamil Nadu and Kerala.
"The hike needed to make domestic rates at par with international prices was Rs 10.50 per litre but oil companies choose to hike rates by less than half of that," the official said. "Another hike in petrol price is on cards soon," he said.
This is the eighth hike in petrol price since the June 2010 decision. Petrol in Delhi cost Rs 51.43 after the June 26 decision of the government deregulating its price.
The official said Saturday's hike in petrol price was made necessary because of rising borrowing of oil companies who faced severe working capital shortage in view of losses incurred on fuel sales.
IOC has seen its borrowing rise by Rs 15,000 crore in the last 45 days as it loses Rs 296 crore per day on fuel sales.
Besides petrol, it loses Rs 18.19 per litre on diesel, Rs 29.69 a litre on kerosene and Rs 329.73 per 14.2-kg LPG cylinder.
(With NDTV inputs)