State-run Indian Oil Corp (IOC) has reduced price of petrol by Rs 2.16 per litre and that of diesel by Rs 2.10 a litre excluding state levies.

The actual drop in prices will be greater after accounting for the local VAT.

IOC said that the current level of international product prices of petrol and diesel and INR-USD exchange rate necessitate decrease in selling price of petrol and diesel and the resulting benefit is being passed on to the consumers with this price revision.

"The movement of prices in the international oil market and INR-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price changes," the IOC said in a statement late on Monday.

Rates had been rising for the past four weeks and this bucks the trend.

The reduction will be effective from midnight on Tuesday.

A marginal hike in rates was effected from May 1, which saw a 2 paise a litre increase in petrol and 52 paise per litre hike in diesel rates.

Before that, the prices were hiked from April 16, by Rs 1.39 per litre for petrol and Rs. 1.04 a litre for diesel.

(With IANS inputs)