[sindabad.sailor]

As far as I remember, all thermodynamic calculations are expressed in the unit of KJ/Kg. Thus when we refer to heat content of a fuel, the mass of the fuel is important and not volume as expressed by the unit LITRE.

Specific garvity of diesel: 0.95
of petrol: 0.711
(suroce csgnetwork)

Thus a litre of diesel would have 950 - 711 = 239 gms more fuel which is close to 25% more than that of a litre of petrol. So no wonder the higher Kg or grams yield higher mileage.

Now linking this to one comment made earlier that by turning over to diesel we will save crude imports looks incorrect because crude purchases are in the units of weight like Ton.

Hope I am not grossly wrong.

Rgds.

[racerme?]

@Reisender:wonderfull share..thanks.
I never knew that total no. of trucks and buses sold in India were equivalent cars being sold.Also the tax regimes in many european countries is worse than ours..Germany 62%

[Fordmanchau]

Originally Posted by tsk1979

The figures people pulling of wikipedia and US energy department websites are skewed towards petrol because they produce more petrol. The reason is that due to large number of cars, petrol is more in demand.
For petrol, refining is more difficult but for diesel, sulfur removal is difficult, so cost of production comes to same.

I really don't think the figures to be skewed just because they consume more gasoline. That's more of a basic information on the product composition of crude refining.
Meanwhile I found this on the RIL website.

The link is here : Petroleum Refining and Marketing :: Reliance Industries Limited.
Look at the growth % of Petrol and Diesel, though petrol has much less consumption. In this case more diesel usage and continuance of subsidy on diesel will only increase the burden on government. Infact, looking at the petrol and diesel consumption figure above, petrol should be subsidised to promote it's consumption considering that more petrol is produced from crude refining than diesel

The other piece of information I want to put here is this

So petrol is derived at much lower temperature than the diesel. So deriving Petrol from crude looks more easier than deriving diesel.

It would be good if you can present some data on the Indian Crude refining product composition which would give us a more specific picture. I am looking for that , but have not been successful yet.As soon as I get it, i'll post it here.

[anoopap]

Originally Posted by Fordmanchau

The other piece of information I want to put here is this

So petrol is derived at much lower temperature than the diesel. So deriving Petrol from crude looks more easier than deriving diesel.

Very true.
Petrol will cost less from production point of view. But refinery cannot stop at that, else they will be left with more "waste", after refining. Hence cost needs to be "distributed" over the entire range of "products". Can govt price diesel more than petrol in todays scenario ? No, because it will directly affect the production and distribution cost of all necessary items. We pay more for petrol just because of govt policy.

In UK, diesel costs more than petrol. Thats because of demand for diesel, and not due to cost of production.

Price of both these commodities are largely driven by economics of supply/demand rather than production methods or technologies. And in turn, this economics is manipulated by, both scientific and govt policy.

[asr245]

Originally Posted by tsk1979

I do not think that people drive more because they have a diesel car. They have a diesel car because they drive more.
So if you office is 20kms away, you won't stop coming to office if you have a petrol car, will you?

For the 1st part, a whole lot do. There was a post somewhere in this very thread where the poster (a diesel vehicle owner) acknowledged the fact he/she was less careful about fuel wastage when it came to using the diesel vehicle. I have seen many who do the same.

For the 2nd, no I won't. But I plan my car buy accordingly or if I already have a petrol car, I might find a shared cab or use public transport 1-2 days a week. I have also seen many people do this. Mind you if I have a diesel car I will be less motivated to do the same (again, as I have seen many people do).

[nipunkul]

@tsk1979, I am sure that you may have more in-depth info on how the crude refining is being tailored in India.

However, for the benefit of the rest, could you point us to any study/research that shows:

1) How Indian Oil PSU's are managing their output with respect to the crude imported
2) Subsidizing diesel after putting a larger tax on it is good for the economy or environment in the medium/long run.

[harishpr]

without getting into the technicalities of Diesel vs petrol vs CNG vs LPG - For a common man Diesel seems to be the most affordable and easily available low cost fuel.
People don't mind spending upfront 50K or even a lakh over petrol vehicles to acquire a diesel vehicle, because what pinches the most is every full tank in pumping station where Petrol seems way way above than diesel - paisa vasool in that case.
Very few really sit down and calculate on how soon/late will they break-even by going with Diesel vs Petrol.

Diesel seems to be the way forward unless our market gets to see products like Nissan LEAF.

[tsk1979]

Originally Posted by nipunkul

@tsk1979, I am sure that you may have more in-depth info on how the crude refining is being tailored in India.

However, for the benefit of the rest, could you point us to any study/research that shows:

1) How Indian Oil PSU's are managing their output with respect to the crude imported
2) Subsidizing diesel after putting a larger tax on it is good for the economy or environment in the medium/long run.

I am not a petro engineer, all I know for sure is that modern refineries can tailor the output to a large degree.
And diesel refining is actually cheaper than petrol, however, the problem which costs money is sulfur removal.
Lastly even places like Europe are now giving preference to diesel engined cars. Govts are actively encouraging diesel cars due to their better fuel economy and lower CO2 levels.
Sulfur is a problem in India, however, in the west ULSD is getting more and more popular.

[nipunkul]

Originally Posted by tsk1979

Lastly even places like Europe are now giving preference to diesel engined cars.

Agree that diesel is becoming the preferred fuel among masses as the technology around engines moves forward.

However, the reason for diesel subsidy in India, is purely commercial use (becuase it drives prices), which outstrips cars 15:1 And it is these vehicles, that are responsible for 99% of all vehicular air pollution. So SIAM's conclusion generalizing diesel as a better option are extremely flawed.

Tax - subsidy system is wrong and hurts the PSUs into continuously accumulating losses. Instead a straight tax cut would give them up front cash (rather than bonds), which they can use to invest in cleaner sulphur free refining.

Car manufacturers are simply using the subsidy extended to commercial use to their advantage and making fatter margins on diesel cars, since buyers hope to equalize later and dont mind a premium. This is acceptable for small cars which are actually more efficient and the margin at the pump is large as a % of car value.

[souravc]

Originally Posted by sindabad.sailor

Now linking this to one comment made earlier that by turning over to diesel we will save crude imports looks incorrect because crude purchases are in the units of weight like Ton.

Hope I am not grossly wrong.

Rgds.

Crude is purchased in units of barrel which is 42 gallons ( a measure of volume) .

Originally Posted by tsk1979

I am not a petro engineer, all I know for sure is that modern refineries can tailor the output to a large degree.
And diesel refining is actually cheaper than petrol, however, the problem which costs money is sulfur removal.
Lastly even places like Europe are now giving preference to diesel engined cars. Govts are actively encouraging diesel cars due to their better fuel economy and lower CO2 levels.
Sulfur is a problem in India, however, in the west ULSD is getting more and more popular.

Your point about the ULSD is right , I can see India moving towards it in the very near term just like we have moved forward with the petrol specs.

Resource: show - In this link its depicted in a simplified manner the refining process . As one can see various derivatives are part of the same distillation process so for a refiner the cost structures of petrol and diesel refining are similar.

[RS_DEL]

Originally Posted by souravc

Your point about the ULSD is right , I can see India moving towards it in the very near term just like we have moved forward with the petrol specs.

.

It will be interesting to see how the government tackles the recovery of the outlays on refinery up-gradation for ULSD.

Something has to give. Either price control- this being the ideal solution but not politically feasible, or substantially enhanced taxes on new diesel vehicles (cars & SUVs') or a mix of both. Either ways the dream run that auto companies have been having selling diesel cars seems threatened.

Hence this presentation from SIAM extolling the virtues of diesels?

[souravc]

Originally Posted by RS_DEL

It will be interesting to see how the government tackles the recovery of the outlays on refinery up-gradation for ULSD.

Something has to give. Either price control- this being the ideal solution but not politically feasible, or substantially enhanced taxes on new diesel vehicles (cars & SUVs') or a mix of both. Either ways the dream run that auto companies have been having selling diesel cars seems threatened.

Hence this presentation from SIAM extolling the virtues of diesels?

substantially enhanced taxes on new diesel vehicles (cars & SUVs') - thats the route which is going to be adopted

I don't believe that the SIAM presentation is exaggerating or with vested interest. Having owned petrol cars for ten years and coming from a family where we used to snigger at diesels ( truck gadi ! ) I did a lot of hard core research ( googling, speaking to friends who work in Hyundai/Fiat, taking inputs from B-i-L who works in IOC) on the fuel and its comparo vis-a-vis petrol before even taking diesel cars into consideration. Fuel expense was not a consideration for me , proof that diesel is a cleaner burning fuel was an eye opener.
From my experience I can say that the presentation makes quite a few valid points and even at price parity adoption of diesel should be encouraged. In Europe, where environmental consciousness is pretty high adoption of diesel as a cleaner fuel is established (I know that they use ULSD but even petrol went through evolution and India adopted it with a lag ! ) - there diesel cars are costlier than petrol cars ( however marginally) since diesel engines are more expensive to build.
So net net I see a strengthening of the diesel run - btw, hope you have noted that this year Le Mans was again won by a TDi vehicle , proof of the speed and endurance of diesel cars ( one more myth that has been busted over the years )

[RX135]

Originally Posted by rpmx1000

@Nipunkul ,

The part you miss is that one barrel of crude produces 19 litres of gasoline AND 10 gallons of diesel. Not OR. You seem to want to state that a barrel
can produce 19 gallons of petrol OR 10 gallons of diesel , thereby indicating more crude import . Wrong. Petrol and diesel are both byproducts of crude, if you understand that key sentence correct.

I suggest, you try to think through it once again.

[RS_DEL]

Originally Posted by souravc

substantially enhanced taxes on new diesel vehicles (cars & SUVs') - thats the route which is going to be adopted

I don't believe that the SIAM presentation is exaggerating or with vested interest.

[a] I am NOT competent to comment on the relative merits and demerits of either of the fuels. Keeping that in mind wherever I commented on the subject it is ONLY with respect to the issue of pricing and the subsidy nonsense. So I will defer to the views of those who are competent on the subject.

[b] I will however disagree with you on the point of SIAM's motivations &/or stand on the subject. Please note it is NOT my contention that SIAM's presentation is technically incorrect. My submission is that in an era of rising interest rates & fuel costs, it is the diesels that are shoring up the fortunes of the auto makers. Rationalization of diesel prices OR enhanced taxation on diesel vehicles is something that can hurt them and will hurt them. Only those buyers who are truly appreciative of the advantages of diesels (whether power delivery characteristics or better mileage in the new tech diesels) will plonk up the additional outlay required for a diesel vehicle. This will cause a contraction in volumes. Further if we go down the ULSD route in the country, then the volume contraction on the diesel side could be more severe. My gut feel says that it is these apprehensions that are driving SIAM more than the desire to promote a better fuel - mebbe coz I am a cynical ole geezer ( mods kindly indulge my transgression on the language side in the post ). Scouts honour wont happen again.

[silentscreamers]

I would like to add a different line of thought to this argument. Please correct me if I am wrong.

Lets say the subsidy on diesel is removed immediately and it comes to similar levels of prices of petrol right now.
Immediate effects to the common man would be, increase in transportation costs (for private and commercial vehicles), which would in turn lead to an increase in prices of all basic necessities including, food, housing and clothing, as well as all other commodities. Now, wouldn't that impact the expenses of each and every household drastically? Even households which do not own a vehicle would be severely impacted, as prices of each and every commodity, basic and luxury, would increase. What would that do to the Lower Income Groups and the poor?

Currently around 40% of the population are in the, under Rs. 200,000 income group which brings them more or less under the 0% income tax slab, which means that the above stated population is not affected in any way by the taxation for diesel subsidy, but they would surely be impacted by the rise in diesel prices if the subsidies are removed! What would do that to their monthly household expenses and incomes?

Many cities, Tier I & Tier II, now have access to alternative fuels like CNG & LPG for public transport vehicles, but they are only a handful. What happens to the Tier III cities & the 6,38,596 villages in India? How would the increase in diesel prices affect the transport facilities and commodities available to these population?

Even hiring a cab or using private services for transport would become expensive.

Now, lets say that the GOI decides to subsidize prices only for commercial and agriculture based vehicles and equipment and decides to increase diesel prices to international levels. Wouldn't this move impact hugely, the innumerable households which have to rely on diesel generators to power up their households?
This step could bring in a new level of corruption in the system where in rogue petrol pump owners could misuse the law and offer subsidized diesel at a little higher margin to private car owners, to book huge profits.
Wouldn't that just shift the profit booking currently made by car manufacturers to petrol pump owners and dealers?

And sincerely I cannot understand the problem if a car manufacturer earns profit for a product which is in demand. So what if they book profits for diesel cars which are so high in demand? Isn't that the very idea of capitalism, wherein prices of a product are determined by the demand and supply statistics of the market?
It is done by every manufacturer of every commodity in every field, not just automobiles. Period.

I would like to add though, that it is absolutely necessary in the long run to rationalize the diesel prices in tune with international prices, 'eventually'. But as for the immediate future, without a definite infrastructure to check, corruption, inflation, poverty and income disparity amongst the population, it would surely be 'mindless' (for lack of a better word), to increase diesel prices and add on to the burden of the common man. The per capita income of the Indian citizen has to increase, before any drastic step.

This can be countered by raising taxes on diesel automobiles for the immediate future and gradually increasing diesel prices (happening anyway), which can reduce the level of subsidies offered by the GOI and carve the way for a free price fuel regime, in the future.

I would again request you to please correct me or add to my line of thought, if I've gone wrong or missed anywhere.