The government on Tuesday slashed the basic excise duty on petrol and diesel – both branded and unbranded – by Rs 2 per litre. The new prices will be effective from Wednesday.

The decision will help cushion the impact of rising crude oil prices on retail petrol and diesel prices, a government release said. The government, however, expects an extra revenue loss of Rs 13,000 crore in the remaining financial year because of the reduction.

Petrol price in Delhi rose from Rs 65.48 per litre on June 16, when the daily price revision mechanism was implemented, to Rs 70.83 per litre on October 2. Other cities have also seen significant increase in petrol and diesel prices during this period.

This reflected in the wholesale price index-based inflation as well, which rose to 3.24% in August, from 1.88% in July, the government said.