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Old 31st October 2013, 19:06   #3406
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Default Re: The Official Fuel Prices Thread

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Originally Posted by el lobo 6061 View Post

Petrol is actually got a cut of Rs. 1.15 instead of Rs. 1.5
Oh, a typo by TOI, but a 1.5 would have been appreciated. Rs 1.15 is still quite less considering strong rupee.
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Old 31st October 2013, 19:38   #3407
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Default Re: The Official Fuel Prices Thread

Have things only improved marginally? I was expecting a minimum decrease of 2 rs because the last fortnight prices were maintained. So over the course of 30 days and much recovery only 1.15 has been reduced.

Funny they increase so rapidly but decrease so reluctantly.
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Old 31st October 2013, 19:46   #3408
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Default Re: The Official Fuel Prices Thread

Every increase of .50p in diesel, actually bumps up the cost of Diesel in Bangalore by close to 80p...Really sad at this.
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Old 31st October 2013, 23:39   #3409
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Default Re: The Official Fuel Prices Thread

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Originally Posted by sgiitk View Post
So does high inflation. What is the biggest subsidy - Fuel. Cut down on that and you see the rupee shoot up, and then the positive spiral sets in.
Inflation is the indicator of high costs, high costs are not the result of inflation. Subsidies keep costs down. So am not sure i understand your point. The value of the rupee to the dollar has limited impact on inflation. As most essentials in calculating inflation the inflation index are not imported.

Are you suggesting that high inflation results in high fuel prices? How will subsidies have any impact on the rupee? Unless you are implying that letting diesel prices go up will result in lower demand which will drive consumption down and therefore bring eventually reduce dependence on imported fuel allowing the rupee to appreciate. Even if that assumption is true (which it is not, fuel, like cigarettes is fairly inelastic and consumption will not go down significantly) increasing prices of these products will take eons to reflect in consumption reduction.

Of course, this is an entirely theoretical discussion but the fundamental rational assumption would be that increasing costs of the inputs will lead to an increase in the price of the outputs.

Edited to add: Subsidising fuel vs. raising prices is a zero sum (in a macro-economical non-inflationary perspective), because the cost either goes from the government's pocket or from the common man's pocket. Either way because fuel is primarily an imported commodity the cost incurred over all is the same. In a micro-economical perspective subsidising prevents the burden going on the common man (inflation), passing the burden frees up more money for the government to spend on other initiatives (which may or may not be used to curtail inflation). The reason the RBI increases rates to curtail inflation is to bring down demand and dissuade people from over-spending. However this does not work on essentials like food & fuel, which is why they are the most subsidised sectors.

Last edited by RoadTrippin : 31st October 2013 at 23:44. Reason: Adding additional point.
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Old 1st November 2013, 09:11   #3410
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Default Re: The Official Fuel Prices Thread

The 1.15 plus the state loot drop on Petrol, 0.50+ increase on Diesel, and a 4.5% drop in ATF is more or less on expected lines. Are some state polls before the 15th? D is still claimed to be losing Rs.9.68 per litre.

Kirit Parikh committee ignored for the nth time, I think he should publicly refuse not to head such jokes in the future.

To me ATF is a more accurate indicator that P or D, less politics.

Last edited by sgiitk : 1st November 2013 at 09:12.
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Old 2nd November 2013, 19:23   #3411
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Default Re: The Official Fuel Prices Thread

Fuel price difference between cities just few kilometers apart. Local Body Tax (LBT) is sending prices sky rocketing in Navi Mumbai jurisdiction.

Price : Vashi Chembur Kharghar
Petrol : 80.1 . 78.08 . 76.37
Diesel : 63.3 . 60.08 . 58.41
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Old 3rd November 2013, 15:03   #3412
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Default Re: The Official Fuel Prices Thread

Quote:
Originally Posted by RoadTrippin View Post
Inflation is the indicator of high costs, high costs are not the result of inflation. Subsidies keep costs down. So am not sure i understand your point. The value of the rupee to the dollar has limited impact on inflation. As most essentials in calculating inflation the inflation index are not imported.

Are you suggesting that high inflation results in high fuel prices? How will subsidies have any impact on the rupee?
There never is a free lunch. All profligacy has a price.

Subsidies mean higher budget deficits, worse dollar rates, and higher inflation. Monetary theory frowns on it.

Remember the best performing economies - Switzerland, Austria Germany all all monetarist. Of course the EU issues have made Germany a bit moderate.

Just imagine the Rupee at 52 to a dollar. Fuel 20%+ cheaper, no subsidy left on Diesel, ... Low inflation. Also, some money left for social schemes. A lot of this is discussed in the Investment Threads.

Last edited by sgiitk : 3rd November 2013 at 15:05.
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Old 3rd November 2013, 21:31   #3413
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Default Re: The Official Fuel Prices Thread

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Originally Posted by sgiitk View Post
Subsidies mean higher budget deficits, worse dollar rates, and higher inflation. Monetary theory frowns on it.

Remember the best performing economies - Switzerland, Austria Germany all all monetarist. Of course the EU issues have made Germany a bit moderate.
Couldn't disagree more. There are fundamental differences when working in developing markets that do not apply to developed markets like the ones you mention. And the assumption that they are the best performing economies because they are monetarists is flawed. I can equally argue that they are monetarists because they are developed and are able to afford it. If the government tomorrow stopped all subsidies, this country will collapse into total chaos. The notion that subsidies are bad is inherently flawed because this comes from academics who do not pay enough attention to the exigencies of the real world.

I can discuss the economics of it in further detail in its own thread if someone can point me to it. Don't want to derail this one
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Old 4th November 2013, 09:11   #3414
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Default Re: The Official Fuel Prices Thread

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Couldn't disagree more. There are fundamental differences when working in developing markets that do not apply to developed markets like the ones you mention.
Not surprised, we can disagree since Keynes and Hayek always did, and even today there is a war between the two camps.

We can all see the effect of Keynesian economics over 65+ years. Only in the Jaswant years did we try to reverse, when inflation dropped to about 4% and we had a current account surplus.

In the 50's Korea was no better than us, nor was Taiwan. See where they are today! Take UK, Maggie switched from Keynes to Hayek and what happened. US got into a mess only when Bush went Keynesian, Even today some economists feel the QE may last for decades, since once you get onto the spending Tiger getting off is not easy.
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Old 8th November 2013, 19:48   #3415
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Default Re: The Official Fuel Prices Thread

Petroleum minister pushes for cut in duties on branded petrol, diesel.

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Petroleum minister Veerappa Moily is pushing the finance ministry for a cut in duties on branded petrol and diesel. The ministry, at present, levies higher excise duty on branded petrol and diesel, making them costlier than unbranded fuel.
Source:Financial Express - Link
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Old 11th November 2013, 11:19   #3416
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Default Re: The Official Fuel Prices Thread

Totally Off Track:
Recently I have seen most of the IOC pumps have started selling 93 Octane petrol in Delhi. Can you please let me know, if I can use the same for my 2010 City A/T? If yes, what will be the advantages over non-branded fuel? If No, then whats the reason behind it? Does Engine doesnt supports it or Honda doesnt recommends, which may void the extended warranty ?
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Old 11th November 2013, 13:43   #3417
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Question Re: The Official Fuel Prices Thread

Quote:
Originally Posted by el lobo 6061 View Post
Fuel price difference between cities just few kilometers apart. Local Body Tax (LBT) is sending prices sky rocketing in Navi Mumbai jurisdiction.

Price : Vashi Chembur Kharghar
Petrol : 80.1 . 78.08 . 76.37
Diesel : 63.3 . 60.08 . 58.41
Surprised to see different fuel prices for Vashi and Kharghar as they both fall under Navi Mumbai jurisdiction. Any reasons for the same?
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Old 11th November 2013, 14:08   #3418
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Default Re: The Official Fuel Prices Thread

As per today's news article the Oil ministry has asked the Finance ministry to cut duties on branded fuels because branded fuel gives better mileage which will thereby help reduce oil consumption.
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Old 11th November 2013, 14:27   #3419
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Default Re: The Official Fuel Prices Thread

Hello All,

Rather than allowing state goverments to impose whatever taxes they wish on petroleum products, why cannot we have a uniform tax regime on fuels across India.

I mean they should fix the Central government & State Government taxes on Petroleum products, so that the price of fuel remains same across India.

In some way this will also help in saving fuel & pollution as many people travel couple of kilometers just to fill cheaper fuel in their cars from pumps located at nearby tax jurisdictions as they manage to sell at a lower price due to lower taxes.

Thanks,
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Old 11th November 2013, 14:46   #3420
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Default Re: The Official Fuel Prices Thread

Quote:
Originally Posted by ghodlur View Post
Surprised to see different fuel prices for Vashi and Kharghar as they both fall under Navi Mumbai jurisdiction. Any reasons for the same?
Kharghar comes under Raigad district, while others are in Mumbai
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