[.sourov]

I am simply stunned by this decision, who says 2-wheelers are for the poor. My bike’s fuel bills will surpass the car’s bill by huge margins.
From now it will only be car to office bike will only be out on days when I need to showoff that I own a petrol powered engine.

[sameerg001]

Damn!! one of the steepest hike ever, i was expecting a hike of around 2-3 rupees, looks like i should sell my accent now and get a diesel sedan instead, petrol expenses have been burning a big hole in our pocket, and this hike made it more worse.

From last few days, i was delaying my visit to fuel station to fill up my car, but as soon as i heard the news on TV, i ran out of the home( as someone fired up my pants ), reached petrol pump in 5 minutes and there were around 7-8 cars in front of me, and withing minutes, there were around 15-20 cars behind me and around 60 bikes in the pump .

Thank god, i managed to get fuel in 10 minutes and filled her up to the brim, managed to get 34 liters, saved around 240rs


I have decided to upgrade to a diesel car as soon as possible, with petrol hikes every now and then, i'll have to take loan for petrol in future, filling up diesel won't pinch much even after some hike. So diesel it'll be.

Cheers
Sameer

[one-77]

Originally Posted by pratheekkunder

Well, there is a good news as well. After Goa, Gujarat,West Bengal and Kerala will be cutting state tax to ease peoples frustration. Kerala will be the first one to do it followed by Gujarat and then West Bengal. West Bengal, would be doing this in phases, whereas others would do it in one go. The person who told me this is Economics professor in my B-School who also happens to be an economists and Govt Advisor.

It's highly unlikely that the Kerala government will drop all it's share of tax from petrol. Maybe they'll forgo the additional revenue from the hike, which should be some 1.xx rupee, in view of the crucial by-election next month.
The only time that's good for the common man seems to be election time.

[babu.sundaram]

Off all the negatives of the hike, I hope some positives turn out:
- Petrol is way expensive, drive to office in car pools, use public transport, lesser single occupant cars
- Possibly lesser traffic jams --> Better FE?
- More efficient petrol engines (instead of more powerful ones) --> Lesser fuel spent?
- May be more people would opt to work from home / avoid travel -- lesser / no fuel spent!

(Even petrol @81+ isn't enough to give up private transport, what a mess it would be, if petrol is at 50 rs, just imagine the number of two wheelers !).

[S2!!!]

Today when I saw the news about the petrol hike only 1 thought came to my mind. If the oil companies are losing revenue as they say then IMO why is our govt. not compensating them out of the tax payers money?? Our (tax payer's) money is being wasted and used to fill pockets of our "representatives" in the ministry each and every day and there is no account of the lakhs of crores of rupees going either in perks or foreign visits or inflated costs of infrastructure and what not!!

With inflation at its peak this hike is just a K.O punch to the common man.

@babu.sundaram - your points are valid but public transport isn't the best either. And atleast in the suburbs of Mumbai to climb into a BEST/ a local train at peak hours is an achievement in its own, not forgetting the arrogant auto wallas and cabbies. We don't have a good public transport system nor dedicated cycling lanes (as an alternative) on our over crowded streets. What to do in such a case if you say avoid a private vehicle??

[itaughtthestig]

On the bright side, this should really open up the used petrol car market.
In case you need an extra car, now is probably the time to pick up a used luxo barge!

[raul]

While painful perhaps inevitable. We need a Elon Musk here. I think there should be complete deregulation of prices so alternative energy sources can be tapped and made viable.

How can India already reeling afford to divert resources to those who don't need it. Let the 'subsidies' be used for those who need it and by last count that's around 59% living on less than Rs 20 a day, not working folks who can afford to buy necessities, farmers with gensets , or even worse malls and private car owners.

If its going to cost 70 bucks as opposed to 45 to transport essentials let it reflect in the end prices and let those who are gainfully employed be paid enough by public and private sector to afford it without any artificial price control and subsidy. Better than the government squandering funds or the private sector paying less. Let's have a real economy with real rates for everything from oil to labour.

Let the state directly help those who need it like the unemployed, destitute, subsistence farmers, orphans, deserted, old folks with direct food stamps. I don't see how cheaper prices help these folks, they only help create artificial imbalances in the economy and allow employers to pay less, in other words we are only subsidising employers, and this does not make sense in a country like India.

[Fornax]

Please spare the hyperboles guys. Whom are we kidding? A 300 bucks increase isn't ganna make anyone on this board any poor? What's really gonna hit us bad is a likely hike in Diesel sometime soon...

My only prayer to the morons in delhi is to ensure that firm steps are taken to bring down the 13% current a/c deficit...coz that [i]will make us poor[i] over a period, a la the Europeans.

About the hike, I don't think it'll stick, the commies are gonna cry theirs throats hoarse tomm.

[silverado]

Lets face it, hike is here and the prices will get slashed by some amount as always is the case to make things look better and fool people.

On a positive note, lets hope Hinjewadi is less cluttered with Traffic from now on.
I hope they make public transport a priority development in all the major cities.

Also cycling should be encouraged more even though our weather does not encourage that
Parking covers will become much more important now.

[muke31]

Why not the central and state govts reduce the tax on fuel and this should reduce the burdon on common man little bit instead of raising fuel price to dangerous level where intead of car being necessity nowadays is turning out to be a luxury item.

SunFilm or no SunFilm in vehicles is not going to affect at great extent but Fuel hikes affects everyone even with deep pockets.

They are also not ready to provide any backing or support any R&D or production of vehicles running on renewable source of energy.

The Future is renewable source or alternate energy source, govt support is needed to drive it vigorously, i dont sense any form of urgency with country heads where they show urgency only when they want to save their chairs, any difficult decision to save their chairs is taken within few hours but not these kinds of important decisions are taken even after so many years of discussions, the policy makers must understand the future and make a strong policy which should help future generations.

Automobile plays an important role in growth of our economy and i hope we dont see shutter downs due inefficient policy makers.

The govt should now seriously conside helping automobile industry by allowing them to bring in future technologies instead of calculating where additional taxes can be added which is a burdon to common man.

-AM

[dhanushs]

Damn!!.. We just planned a Goa trip this weekend in my IKON, as my friends Fiesta TDCi was in the A.S.S. Prior to the hike, the difference/km was just ~2Rs, and now, god knows what!.

Till date, I had been suggesting my friends/family with low monthly running to get a used premium petrol car whist price hikes. But, this hike looks too steep, and NOTHING above ~500km/month warrants a petrol! And ~500km/month is only for those only-drive-to-church-every-Sunday fellows. Not for normal men.

Damn!. The newly laid roads in those ghats are gonna be less travelled for a loonnggggg time!

:( :(

[rjalihal]

Yet another hike in fuel prices. As per Brent Index, 1 barrel of oil is about $105 and has been steadily dropping. The Rupee is also faring poorly as it's demand in the market has fallen. There is a crisis in much of Europe and in such times investors prefer holding cash to risky financial assets such as stocks, bonds etc. This results in mass stocks sell off and thereby increase in the dollar rate. This is the reason for Rupee hitting an all time high. This is just the beginning and all economists are hinting that the Rupee might fall more. Drastic fiscal/monetary policies are need to keep this in check.

Now the reason I went off topic above is that India is a net importer. We have a huge deficit every year. Much of our imports are oil and related products. This puts heavy pressure on the exchequer to meet the requirements. Thus to minimize the borrowing, they are forced to increase price/reduce subsidy of certain commodities. Diesel is the main fuel for transportation and is used extensively in manufacturing. It is not a wise idea to hike diesel price as it will spiral inflation. Petrol is a better alternative to hike as fewer people depend on it. Thus they prefer to hike it's price as the inflation can be contained more efficiently.

I am not very happy with this hike as well. In fact I am contemplating about shifting to a diesel motor in the near future. But then hey, compared to other countries, we are still considered to be 'moderate'. Imagine living in Turkey where the price per litre of petrol is $2.67!

Visit the link below for a list of world wide petrol prices. I found it very informative.

Gasoline and diesel usage and pricing - Wikipedia, the free encyclopedia

Cheers!
Rohan

[Cowardly Lion]

This is going to be a very looooong rant but had to get it off my chest -

We elect our leaders with a hope that they will make use of the considerable resources comprising men & money at their disposal to arrive at and take decisive actions that will solve problems that are beyond an individual’s ken and hence cut the Gordian knot of what seems like complex reality.

At least that is the theory. What we see at present is that the same leaders have long ceased to be a part of the solution and have become a part of the problem. I could mention several issues to prove my point but will stick to rising fuel prices on this forum.

Every time there is a price hike we are told one of the following or sometimes both –
a) Rising Oil Prices
b) Weakening Rupee

We have always been told that we, one of the largest & most profitable markets in the world for basic commodities, is helpless in the face of “international market forces”. Has anyone ever said that the rising oil prices also incorporate a component of monopoly pricing/ corporate greed. Listen to the financial experts and you will only hear about peak oil phenomenon/rising demand on account of BRIC/ and of course the favourite conjunctural political factors like the ever present threat of war with Iran. Ever heard anyone talking about Monopoly mark up...? Guess not

Oil Marketing Companies -
Ask any politician/bureaucrat/Oil Marketing Co’s head honchos ad they will offer even less information and try to convince us that these are matters are far too complex for hoi polloi to understand.
With my very limited understanding of markets I would like to know- Do our Oil importing companies know that there is something called forward trading? Can they not acquire/secure oil contracts much in advance like other players? If they do all this then is the Govt selling us supplies bought at a lower rate at current market values. Is the govt profiteering and that too twice – 1) difference in the procurement & the selling price and 2) increased tax paid on higher selling price?
Are the Oil marketing companies operating efficiently? Have their operations been audited for efficiency so that they don’t add any avoidable cost to a very critical commodity?
The amount of money that is remitted every year on account of oil is so huge that systemic transparency from the original procurement to ultimate sale should be mandatory. Fuel/energy has become too important an issue to be left to the “experts” only. There must be a public debate on the matter as a lack of strategy/lack of development of alternatives shows that they have either long abdicated their responsibility or don’t have the requisite expertise in the said matter.
Oil importing companies on the other hand use every conceivable trick in the book to play with such a critical commodity. The following will make for some very cool reading –
The case for floating oil storage
Oil producers running out of storage space - Business - Oil & energy - msnbc.com



Government

Theoretically politicians hold a position that is akin to that of a Trustee. The indifferent attitude of government that we see in matters like these raises serious doubts regarding the commitment of these trustees. One sees a total absence of regret in their body language when they raise the prices. They have their hands in the till, their avariciousness knows no boundaries. They come on television and inform us on issues such as fuel price hike/rotting food grain in a country where people are dying of hunger/ farmer debt/jailed cartoonist in the most matter of fact manner possible. They spend more time debating whether they should get red beacons on their cars than they do on procuring gunny bags for transportation of surplus grains. That sense of Common Purpose is totally absent.
Coming back to fuel - By selling petrol at 2x times the actual procurement cost the govt reveals to the producers and commodity traders that there is a lot of upside in the price of petrol for them that can still be captured by them as they have no political compulsions. These producers/traders are deviously smart people who only have to manage the market price upwards because they understand that the only loser in this scenario will be the oil buying nation as beyond a certain price the cost of fuel will have no upward elasticity. In such a scenario to keep on buying oil the govt’s will have no option but to reduce taxes and that will only result in the traders/producers capturing a significant portion of the tax reduced rather than allowing the tax reductions to be passed on to the consumers .
Maybe the price rise has been put out keeping in mind that the rupee depreciation is a temporary phenomenon. When the situation corrects itself in another year or so (nearer to the 2014 elections than today) they will reduce the price and go to town about it. The way things are today economically the only way in future seems to be up!
Since the powers that be have no long term vision and are engaged in serious issues of who should/should not become the President of our country, the policy makers always grab the lowest hanging fruit – price rise. Alternative fuels and Mass mobility is addressed only when a city is about to or has already begun to crash under its own load.

Alternative Fuel
I have always felt that the agro fuels for a country like ours is going to be nothing short of a disaster as that will immediately result in transfer of land being used to produce food to fuel and thereby result in food scarcity and hence a price rise. Compared to Petrol the resultant reduction in air pollution too on account of agro based fuel is marginal to none.
I don’t even want to start on the KG basin Natural Gas conundrum. Today we have in the world the lowest Natural Gas prices for quite some time on account of development in Fracking etc and Reliance says that they are facing serious under recoveries from the earlier mentioned targets. This shows that the push and pull exerted by Reliance is such that they can afford to be blasé about the whole thing.
Today Electricity is in short supply as is and another device hankering for it is not something worth getting all up and about over.

A point I would like to make here – if a manufacturer makes a vehicle based on cheaper alternative fuel the manufacturer should not be allowed to capture the savings in the garb of super normal profits (as in the case of selling price of diesel vehicle being more than that of Petrol vehicle). By spreading that money over a larger base (# of customer) rather than a narrower base (# of shareholders) that money is more efficiently utilized in the economy.

Direct Consumer
It is an accepted fact that Economic efficiency is maximised when consumer prices reflect production cost + a decent return on investment. When a subsidy (even notional) is put in place it results in shifting of cost to other economic sectors. Any such action will only be grossly unfair to a non consumer and will encourage inefficiency on part of the direct consumer (one look at diesel/kerosene).
It must be kept in mind that Fuel taxes are also considered as a road user fee. Even then they fall short of the expenses incurred on the making/maintaining roads (not all are tolled).
Keeping this in mind there is no reason why automobile travel should be underpriced and subsidized. I will never accept any argument for a diesel BMW/Merc/Audi. To my mind, when there was a reason for subsidy on diesel then the govt should ot have allowed manufacturing of diesel engines for private automobiles.
Let me give another example – by financing roads with general taxes rather than user taxes benefits only the high consuming entities (individuals and industries) at the expense of non users/energy efficient consumers and industries.



This lont rant is the result of the 7 ½ bucks extra that we will have to pay but that price rise is only a sign of things to come. In the long run, I have a feeling that things will get significantly worse before they get better. I say this because this price rise, as i see it, is only a symptom of the malaise that is affecting our system. If some serious effort is not put in the direction of the alternatives (alt fuel/efficient mass transportation etc) we will keep on getting these wake up calls until they are recognised for what they actually are!

Thanks for bearing with me

[airfoil]

Sales tax is at 33% in Andhra Pradesh. Amounts to highway robbery, only this is legal and sanctioned. While I'm not sure how this hike is effected, it seems like the various Governments are direct beneficiaries.

[robimahanta]

I guess this is the right time to shift to Doha,Qatar where petrol is still around Rs.15 /litre for all petrolheads