(Bloomberg) -- Indian fuel retailers are planning to increase pump prices of gasoline and diesel after a two-month hiatus as climbing oil prices pinch margins, according to company executives.

Oil prices have shot up $3 a barrel in the past two weeks and fuel price hikes are now inevitable, the executives said, asking not to be identified as the matter is private. Local retail prices of the two transport fuels are already at a record.

A near 50% increase in global oil prices this year has pushed up pump prices across the world, causing an inflationary headache for governments from the U.S. to France. President Joe Biden’s administration is taking a closer look at prices after U.S. retail gasoline rate last week rose to the highest since October 2014. France too may take temporary measures to lower the fuel bill of motorists.

In India, taxes on motor fuels have already fanned gains in consumer prices, and a pump price increase now could make it difficult for the inflation-targeting central bank to keep borrowing costs lower for longer to support the economy’s recovery from the pandemic.

Prices are climbing as the world’s biggest economies are seeing fuel demand outpace oil production. 

Oil prices are likely to remain firm in the near to mid-term, said one of the executives.

Spokespeople at the three retailers -- Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp. -- couldn’t immediately comment on the plan. These companies together account for over 90% of Indian fuel sales.

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