Petrol price was slashed by Rs 2.22 a litre, the first reduction in 33 months.
Petrol in Delhi will cost Rs 66.42 per litre with effect from midnight tonight as against Rs 68.64 a litre now.
The reduction comes days after state-owned oil companies raised petrol prices by a steep Rs 1.80 per litre.
State-owned oil companies passed on Rs 1.85 a litre that they gained from a fall in global oil prices and a marginal appreciation in rupee value.
Adding 20 per cent local sales tax, the decrease in Delhi comes to Rs 2.22 per litre.
The reduction in Mumbai was Rs 2.34 per liter while in Kolkata it was Rs 2.31 a litre.
The price cut in Chennai was Rs 2.35 per litre.