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Old 17th December 2007, 23:45   #46
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Default subsidy on Petrol

[quote=supremeBaleno;646314]doc, petrol is NOT subsidised. It is diesel, domestic-LPG (not sure about auto-lpg) and kerosene which are subsidised in India at the cost of petrol.

I believe that any fuel that does not correct its pricing on a weekly basis is subsidized. For e.g Petrol price should have been at about Rs 52/- now but it still remains at the old rates because of impending elections.

Presently the only fuel which is not subsidized is AutoLPG. Actually I am dreading the day when the Government start milking Autolpg to subsidize the other fuels as they cannot touch Petrol, Diesel and Kerosene on a weekly basis especially with the Left Parties breathing down the necks of the Congress.

Please point me to some differing points of view in the form of news articles on the net about the subsidy thing.
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Old 18th December 2007, 00:43   #47
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Well, Our Dear doc is right in this count and SB is a bit off the mark. His views would have been correct had it been, a couple of months ago.I'll can put down some fundas on LPG (whichs a bit more than the customary 2 cents , because its my bread actually!) because most people do not seem to hav a good awareness about it:

As of now, all the Indian oil marketing companies are reeking in multi million rupees for each day of their sorrowfull existence. Earlier Diesel used to be cross subsidized thru Petrol prices and other incomes-Mainly lubes and refineries operating profits. Nowadays even petrol is raking up losses to the corprns since the below par pricing at the moment.

LPG is marketed in three guises- Domesticin 14.2 KG cyls , Non Domestic in 19 kg cyls(The big cyls which u see at the hotels and all-even bigger ones do exist but mainly for industrial customers) and Finally Auto LPG.
Technically speaking, all these products are one and the same(Butane predominant with traces of propane and othe HCS) and in fact, at our plants we do not distinguish between them, although stocks are maintained virtually.The IS specs for Auto LPG is slightly different, but for all practical purposes they are the same only.In fact the domestic LPG exceeds the specs and is capable enough for meeting the AUTO LPG Specs.So there is no wonder that AJO did not damage his car, because its basically same product only ,the difference being the mental perception.

However the real damage whihc is done is , by buying the blackmarketed Cyls you are contributing to weaken the already frail(to the point of being pointless) PDS system. In fact I will take the freedom to go ahead and state that this is Robbery only- In that by buying a cylinder in black you are depriving a less privilaged house wife a refill in time! (mods Pls excuse but educated Team BHPians should do better than support the diversion)

The last time it was calculated ,the OMC's are losing 220+ RS per domestic cylinder sold . That might explain the steep price diferential to the un-initiated.And They cannot run on losses indefinitely.Reserves made during the hey days alredy depleted, GOVT will have to bail them out from bankruptcy Using TAX payers money(read your and mine) only .Hence nobody's getting benifitted in this vicious cycle other than them, the stinking politicians .


Auto LPG and NON domestic LPG are not subsidizes and their prices mirror the international Market prices. Revised Monthly, basis the previous months purchase price+Marketing margins, The prices will go up a notch
or two during winter months,when the product availability itself get affected due ti increased demand in Colder nations. The country's almost 80~90 pc. requirement is met through import only. SO there is no point lamenting the rise in prices, as it simply follows economics. It is bound to come down during slack months of summer as the demand falls.

And still LPG will make a sensible option,as the govt cannot hold down to this prices for long.Its a given.Either they have to loose upon the Cesses and Taxes on Pet. products or a price hike is imminent.The elections happeing in and around various parts of the country only is putting a lid on it, coupled with the Leftist demands.


Hope this lowdon on LPG Might have proved as an Eye opener for Atleast few, and hopefully the message will be taken in the right sense!
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Old 8th January 2008, 21:54   #48
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LPG at 36.20 now, is this true ? If the Government seriously wants people to move to LPG, this is not the right way to do it. I am absolutely shocked.
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Old 8th January 2008, 22:16   #49
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I am not using LPG after I returned from Kerala on Jan 1st. Prices are high and doesnt make sense considering the very long queues at bunks etc. I am lazy to fill up since the saving have dropped drastically.
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Old 8th January 2008, 22:25   #50
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Quote:
Originally Posted by mail4ajo View Post
I am not using LPG after I returned from Kerala on Jan 1st. Prices are high and doesnt make sense considering the very long queues at bunks etc. I am lazy to fill up since the saving have dropped drastically.
I can understand the queues, i had to almost get physical when i tanked up last week. But the price difference is getting way too narrow for comfort. Driving in petrol is wayyyy better which is why yesterday i filled petrol instead of LPG despite no crowd on the LPG side.
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Old 8th January 2008, 22:28   #51
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Well, accept the truth,our govt lacks focus. And AFAIK,there is no specific agenda to support one mode of fuel eventhough there may be any tangible benefits arising from that. People at the top do lack the farsightedness or vision to take such bold stand.

@E_L: If the Government seriously wants people to move to LPG, then what according to you ,is the right way to do that? an artificially maintained lower price thru subsidies?


I guess, had the petrol /diesel prices also shot thru the roofs, then Auto LPG would still have been an economical option being 30 ~40 % cheaper than petrol in actuality.Like petrol @ 60 rs, diesel at 68 rs, Auto LPG at 35 rs.

And trust me, The Auto LPG prices will come down (in relation to Petrol diesel,once the price hike is announced and, secondly when the mercury starts to rise )
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Old 8th January 2008, 22:36   #52
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Quote:
Originally Posted by esteem_lover View Post
I can understand the queues, i had to almost get physical when i tanked up last week. But the price difference is getting way too narrow for comfort. Driving in petrol is wayyyy better which is why yesterday i filled petrol instead of LPG despite no crowd on the LPG side.
The issue in chennai is we have to rub shoulders with unruly auto guys who dont care to keep the queue. I too like the petrol driving experience hence avoiding LPG for some time. The difference is just working to Rs 0.40 paisa per km. I get 12kms on LPG and 14kms on petrol.
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Old 9th January 2008, 08:13   #53
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The question.

Quote:
Originally Posted by aravindwarrier View Post
@E_L: If the Government seriously wants people to move to LPG, then what according to you ,is the right way to do that? an artificially maintained lower price thru subsidies?
The answer.

Quote:
Originally Posted by aravindwarrier View Post
I guess, had the petrol /diesel prices also shot thru the roofs, then Auto LPG would still have been an economical option being 30 ~40 % cheaper than petrol in actuality.Like petrol @ 60 rs, diesel at 68 rs, Auto LPG at 35 rs.
not that i want the petrol/diesel prices to shoot up.
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Old 9th January 2008, 10:01   #54
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Default Why the price hike for LPG day by day..!!

Normally if there is price hike in petrol or diesel it will normally published through the media like newspapers and TV news channel.

But in the case of LPG it is not being done and only by going to the petrol pumps I am aware of the steep price hike. Why ? Does the Government have a control on this and who is authorising the price hike of LPG ?

On what basis the price hike for LPG ?
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Old 9th January 2008, 10:59   #55
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Govt: is not supposed to interfer in LPG Pricing(NON DOMESTIC/Auto LPG) However,they do have watchon the marketing margins of the oil companies.

In fact the earlier machineryof APM(administered price mechanism) was dismantled during the NDA Govt: Period, and OILcompanies given a free hand in raising the Petroleum prices, inline with certain govt.Guidelines regarding Crosss subsidy, Margins etc. With this freedom OIL companies could revise the price evrey week if they required, provided the International marke situations demanded that

The current govt has not reinintiated the APM, but however,has deferred the authority to revise the prices.

However, AFAIK,LPG prices(NON DOMESTIC/Auto LPG) , were never controlledat any point of time,for the simple reason,that it will not afffect their votebanks
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Old 14th January 2008, 00:13   #56
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Default This is the quantum of subsidy.

Quote:
Originally Posted by aravindwarrier View Post
Govt: is not supposed to interfer in LPG Pricing(NON DOMESTIC/Auto LPG) However,they do have watchon the marketing margins of the oil companies.

In fact the earlier machineryof APM(administered price mechanism) was dismantled during the NDA Govt: Period, and OILcompanies given a free hand in raising the Petroleum prices, inline with certain govt.Guidelines regarding Crosss subsidy, Margins etc. With this freedom OIL companies could revise the price evrey week if they required, provided the International marke situations demanded that

The current govt has not reinintiated the APM, but however,has deferred the authority to revise the prices.

However, AFAIK,LPG prices(NON DOMESTIC/Auto LPG) , were never controlledat any point of time,for the simple reason,that it will not afffect their votebanks
A Group of Minister headed by External Affairs Minister Pranab Mukherjee will meet on January 17 to discuss the options and make a recommendations to the Cabinet.

Indian Oil, Hindustan Petroleum and Bharat Petroleum together are projected to lose Rs 71,808 crore on fuel sale in fiscal 2007-08 if prices and duties are not revised. They currently lose Rs 9.20 per litre on petrol, Rs 11 a litre on diesel, Rs 331 per LPG cylinder and Rs 20 per litre on kerosene.
Hike in petrol, diesel and LPG likely-India Business-Business-The Times of India

Last edited by drpullockaran : 14th January 2008 at 00:21.
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Old 6th February 2008, 14:40   #57
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LPG price has gone up to Rs.37.16 this month. Damn, i was expecting a downward trend from february.
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Old 6th February 2008, 15:03   #58
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the price of lpg will still go up and i believe there is no one to question that.when the petrol or diesel price go up the truck people,busses and the auto wallas put up a strike or atleast the news paper put in their views.now if the lpg price goes up no one is bothered.this is a pathetic situation of the public.
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Old 6th February 2008, 15:12   #59
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At 37 rupees, this is the death of alternate fuels in India.
Unless LPGA does something about it, installers and those involved commercially would need to find a different profession. :(
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Old 6th February 2008, 15:34   #60
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I had to make a decision regarding which fuel , diesel or LPG ( indica Turbo VS Wagon R Duo ) . In the end , decided to get the Indica because

1) diesel is plentifully available
2) Reports of engine corrosion in LPG vehicles
3) Not a substantially high Benefit for LPG ( which is even lesser now )
4) Torque
5) Switching over between petrol/LPG if it runs out a headache
6) No compromise on Boot space.
7) higher resale value
8) Diesel price will always remain artificially low to rein in inflation
And Boy am i glad !
I guess LPG Is a cheaper option for Petrolheads who love their rides , as well as their wallets equally.

Last edited by greenhorn : 6th February 2008 at 15:39.
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