Indian Oil Corp, the country's biggest refiner, raised diesel prices by about 1 percent from Saturday in line with the flexibility given by the government, it said in a statement.
The three state-run fuel retailers - IOC, Bharat Petroleum Corp and Hindustan Petroleum Corp - tend to move their prices together.
Government in January allowed fuel retailers to raise the price of subsidised diesel by 1 U.S. cent a litre every month and asked bulk buyers to pay market rates.
It deregulated gasoline prices in June 2010. In Delhi, diesel will cost 48.67 rupees per litre as charged by IOC from Saturday.