Only branded, costlier fuel in metros

[nitrous]

In all probability, these companies would be giving us regular fuel at "premium" prices.
I don't think the Govt. would let this happen.
But, if it does happen, i think its high time we get out of our Air conditioned cars and do this:

[dadu]

Saw today morning's CNN-IBN report on this,

- Only branded premium fuels to be sold in major cities.
- This will be followed by increase in prices of branded fuel as they are not controlled by govt.
- OC's have already told their LPG dealers not to issue any new connections

All this is to recover losses as crude oil barrel prices touch the sky.

[benbsb29]

And the government sits on its throne and watches the whole tamasha?!

I hope this doesnt come through.

[LLL]

This is another crazy ideas that we Indians manage to come up with.

We had BRT corridor now premium fuels in metros.

Pretty soon we will see "fuel smuggling" happening. People visiting fuel pumps outside the metro borders with large drums and bringing in normal fuel and selling it off in metros. Or people living close to borders going outside to get fuel.

Also, since i am forced to buy HP premium fuel which costs nearly same as reliance fuel, why would i buy from HP?

ALmost every state has experienced similar situation when they banned alcohol. Ppl would go outside the state and buy liquor and smuggle it back or go outside to get drunk and come back. Almost every state had given up prohibition after few months of experimentation as it was not implementable.

Similarly this premium-fuel-thingy wont work.

[LLL]

Originally Posted by benbsb29

And the government sits on its throne and watches the whole tamasha?!

I hope this doesnt come through.

Our politicians will wake up when it hits them. They move in convoy of 10 cars and it will hit the opposition politicos hard. (Those in govt buy fuel using taxpayers money). Then they will raise a stink and this move will be reversed.

Also more ppl will switch to LPG and CNG & govt is already subsidizing these. So the drain isnt going to get plugged.

[sammyboy]

This is really stupid. And does the govt have any clue about the amount of CNG will be required when people move to it ? Where will they get the stocks from? Also talking about lpg, saw in the news yesterday, IOC etc, want to stop giving new connections and set a rule for 1 cylinder per family. Though this was quashed they still have unofficially told their dealers to refrain from giving new connections.

These people have really gone bonkers .

[dadu]

I am afraid it will happen, already done to LPG, rest will follow.

The govt cannot control the branded fuel prices, neither can they control the supply, which the OC's will reduce for unbranded fuel in all these major cities.

Be mentally prepared to shell out more for your monthly fuel expenses or else use the public/shared transport.

It will not be long.

Originally Posted by LLL

Our politicians will wake up when it hits them. They move in convoy of 10 cars and it will hit the opposition politicos hard. (Those in govt buy fuel using taxpayers money). Then they will raise a stink and this move will be reversed.

Also more ppl will switch to LPG and CNG & govt is already subsidizing these. So the drain isnt going to get plugged.

[mjothi]

I guess Govt. is indirectly promoting the Tier-II and III cities.
This will certainly increase the sale of Diesel vehicles.
Just curious, how about the premium Diesels? I believe that it is also subsidized right? Why should a premium product be subsidized?

OT: When i returned last time from Chennai, I saw that most of the BP did not had normal petrol. i am taking about the bunks on the highway. I started enquiring it after I crossed Sriperambatur. Everyone said (till hosur) they had only Speed with them. So, I did not fill it.

Seems it already started silently.

[csentil]

Yup, went yesterday to the BP pump at Jeevan Bheema Nagar. They said only Speed is available. I had read about the news and kept asking them about the reason. They said stocks are not available; tanker is on the way; got delayed and some more nonsense. As I was running dry, I had to tank up.

Anyways this is sheer nonsense.

[rudrah]

[FONT=arial][COLOR=#2c2c2c]Just read in todays paper...

Public sector oil companies plan to give branded diesel a big push in urban markets while increasing the spread of branded petrol across india.

Branded diesel is Rs 1.25 dearer than the regular variety while the difference is about rs3 in the case of petrol. cars in cities already use branded petrol in a big way.
in the case of market leader indianoil, it accounts for 45% of sales across its 18,000-odd retail outlets. this is substantially higher at close to 60% in the case of branded diesel which is sold in a big way at its highway outlets. sources say that this is "more or less the same" for hindustan petroleum and bharat petroleum.
both petrol and diesel are sold at prices far below their actual costs and the losses for each of them are nearly Rs 14 and Rs 21 per litre. oil industry sources, however, say that the focus on branded fuels can only alleviate this to an extent because the difference is not so appreciable.
"it is asinine to think that moving to branded diesel and petrol is the solution to wiping out losses incurred due to under-recoveries. we believe that these are better options for the automotive industry because they enhance engine life for vehicles," they add.

Diesel accounts for the lion's share of the projected under-recoveries of Rs 200,000 crore this fiscal for the three oil companies. to that extent, sales of branded diesel will lower this by Rs 1.25 per litre but then it only accounts for 60% of diesel sold in the country. ideally, the oil companies would like to have 100% of their sales taken over by branded petrol and diesel in the years to come.

Sources say that this shift to branded fuels does not require any approval from the government since this is an initiative to give customers the best option. further, it is the only way oil companies can hope to marginally lower the levels of under-recoveries. whether these branded fuels will see a price increase soon remains to be seen.

Source: DNA, Mumbai
[/COLOR][/FONT]

[LLL]

Originally Posted by rudrah

their actual costs and the losses for each of them are nearly Rs 14 and Rs 21 per litre.

I dont understand why the oil companies are so worried about their losses. Its not as if they are going to go bankrupt and have to shut shop or they have to make revenue to pay its employees. They can continue to buy high and sell low and govt can keep on funding them for wages and crude purchases.

Why are they taking so much tension?

[mjothi]

Originally Posted by rudrah

Sources say that this shift to branded fuels does not require any approval from the government since this is an initiative to give customers the best option. further, it is the only way oil companies can hope to marginally lower the levels of under-recoveries. whether these branded fuels will see a price increase soon remains to be seen.

Source: DNA, Mumbai

I think people should decide whats good or best option. This move looks like OC's will "force" us to buy the expensive stuff. The bunks in the borders will benfit a lot on this I guess. Eg: The bunks around Hosur, will be a target for people in and around bangalore near there.
I also have a doubt, Will this be due to some backgorund work from private players like Reliance, shell etc to oil ministries

[rudrah]

Originally Posted by mjothi

I think people should decide whats good or best option. This move looks like OC's will "force" us to buy the expensive stuff. The bunks in the borders will benfit a lot on this I guess. Eg: The bunks around Hosur, will be a target for people in and around bangalore near there.
I also have a doubt, Will this be due to some backgorund work from private players like Reliance, shell etc to oil ministries

totally....

The big fishes always play a hand in glove with the govt....in respect to a big change in the market!

[suvi]

Originally Posted by LLL

I dont understand why the oil companies are so worried about their losses. Its not as if they are going to go bankrupt and have to shut shop or they have to make revenue to pay its employees. They can continue to buy high and sell low and govt can keep on funding them for wages and crude purchases.

Why are they taking so much tension?

All the three OMCs are Public Sector companies with considerable ownership (30% or so) held by general public (direct or through mutual funds).
It is technically incorrect for Government to force these companies to go into loss, since loss is shared not only by them but also by the investors. if they want to have price control they must reduce taxes / pay directly the difference to the OMCs.

[mjothi]

Originally Posted by suvi

All the three OMCs are Public Sector companies with considerable ownership (30% or so) held by general public (direct or through mutual funds).
It is technically incorrect for Government to force these companies to go into loss, since loss is shared not only by them but also by the investors. if they want to have price control they must reduce taxes / pay directly the difference to the OMCs.

Agreed 100%. Btw. can we know the exact figure for the split up of the price for both Petrol & Diesel with the tax component? Possibly a RTI act should help us here. Wonder why no media is even publishing those component?

Then we know if govt is providing subsidy or taking from tax payers...