New Delhi, Jan 1 (PTI) : Petrol price was on Thursday cut by 63 paise per litre and diesel by Rs 1.06 a litre, the third reduction in December on back of softening in global oil rates.

Petrol will cost Rs 59.35 per litre in Delhi with effect from midnight on Thursday as against Rs 59.98 currently. A litre of diesel will cost Rs 45.03 as opposed to Rs 46.09 presently, said Indian Oil Corp (IOC), the nation's biggest fuel retailer.

The reduction would have been more but for government move to mop up gains arising from oil prices slumping to 11-year low by way of an excise duty hike.

Prices were last cut by 50 paise in case of petrol and 46 paise a litre in diesel on December 16. The reduction would have been more but for government move to mop up gains arising from oil prices slumping to 11-year low by way of an excise duty hike.

Prior to that oil firms had last cut petrol price by 58 paise per litre and diesel by 25 paise on December 1.

"The current level of international product prices of Petrol and Diesel and INR-USD exchange rate warrant a decrease in prices, the impact of which is being passed on to the consumers with this price revision," IOC said in a statement.

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, it added.