Following the restlessness of common people over the hiked price of petrol and diesel, it is reported that oil companies have reduced the price of diesel.

As per reports, the diesel prices have been cut down by Rs 1.62 paisa. The new prices will take effect from midnight.

Earlier, on May 12, 2014 the oil companies raised the diesel prices by Rs 1.90 paisa.

The Cabinet had in January last year decided that diesel prices should be raised by 40-50 paise a litre every month until losses on the fuel are wiped out. Diesel prices have risen by a cumulative Rs.8.33 a litre in 14 instalments since January 2013.

Few days back, Tamil Nadu Chief Minister J.Jayalalithaa demanded the central government to withdraw the diesel price rise, saying that it will have an inflationary effect.

According to her, the oil pricing mechanism should be changed by factoring the cost of crude - both imported and domestically explored and its refining costs.

The latest development may be the reflection of her demand.