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-   -   Petrol Price Hike. EDIT - 15th July 2013 -- Hiked by Rs. 1.55/- (https://www.team-bhp.com/forum/indian-car-scene/121005-petrol-price-hike-edit-15th-july-2013-hiked-rs-1-55-a-16.html)

The prices quoted are the Singapore Brent Crude, India does not buy that, we are not in that market (why? god knows, we are erratic buyers, we do not participate in organized buying, and we buy short term? again why? Ask Mr. Singh and the previous govts).

So we buy crude at comparatively high rates and pay more due to the falling rupee!

This thread is about all of us being like :Frustrati

While the suits and the MPs are all like :I Rule:


In other news, the Octavia vRs enters the Team Bhp Hall-Of-Fame thanks to the running costs on one hand and Skoda maintenance on the other!

The EGoM that was supposed to meet this Friday for deciding the fuel hike on diesel and LPG is not meeting. :(
This has been very convenient way for the govt. to avoid price hike in diesel. The EGoM has not met in a year now and looks like they will keep avoiding the meeting.
Petrol price hike: EGoM not meeting on Friday, says GC Chaturvedi - The Economic Times

With the news of deregularising the Diesel as well, the common man is being pushed to the wall.

A Rs. 7.50/-(in Mumbai Rs. 7.92/- per lt) is unprecedented and unjust.

The barrel prices have infact come down to $108 and our Govt. decides to hike the petrol rates.

Come Gujarat elections, the Govt. will roll back Rs. 1.50/- per lt and display its magnanimous nature.

BTW, 50% of the fuel rates are TAXES!!

And am thanking God for the CNG heart in my Waggie...

Actually thats the WTI (Western Texas Intermediate) crude price. The Singapore Brent Crude that India buys is hovering at the $106-107 mark as of today from the high of $120. Both are low sulfur crude but WTI has lower sulfur content. Based on where they are sourced from and refined, the prices vary.

Hello Samarjitdhar,

Thank you for the the clarification.

But still the Prices of Crude is down 10% (from $ 120 to $ 108) & US Dollar has risen by 10% (from Rs. 50 to Rs. 55). Thus I feel that the approx amount Indian needs to pay for one barrel of Crude is almost the same. Thus why are Oil marketing showing huge loses?

Also recently India has entered a long term contract with Iran to pay for Crude in Rupees. Thus here the change in Dollar prices does not effect.

Not under-estimating the Government's financial advisors, but things are not transperent to common man & something seems fishy here.

Thanks,

- There are old junked trucks which can hold 500 liters kind available. So the ferrying cost need not be that high.
- Enforcement to check? Are you kidding? Our cops haven't managed to bust even using domestic cylinders at hotels? With this (bribe) capital, one wouldnt be surprised to see cops themselves joining hands with mafia! (Nothing would be new though!)
- Who would buy? There are lots of people who aren't that concerned about even running their vehicles on kerosene as long as it runs!

(This is a country where LPG retrofit kits are available for 2 wheelers in grey market and morons strap them to run with domestic LPG! Everything possible!).

Why thus far? An apartment complex can buy a junkie truck (in the pretext of private use) and apartment owners can co-operate! A simple, yet very useful co-op society!

At best, this proposal can make some more folks rich(er) in this very enterprising nation !

Well sad to state the obvious but our financial advisors in the government are one of the worst I think. Most of them are bureaucrats who have typically no knowledge of the industry or the domain they work in or regulate. No wonder policy in every field has failed miserably. Western Nations even though don't do exceptionally well but at least are slightly better ensuring that only some form of expertise is included in governance.

Ours is a total babu raaj with absolute indifference towards capabilities or performance. In fact if we can get a pack of chimps in their place, even they might do a better job. Coming to the price hike, this was pretty well orchestrated and the government knew that the oil ministry was pushing for a Rs 4 hike. So they very shrewdly announced Rs 7.5 and then immediately have come up with a rollback of Rs 2. Sadly they will try to pull wool over our eyes with this MASSIVE rollback. I will give anything in the world for these nincompoops to be removed from any position of policy or decision making.

EDIT: I just made a rough calculation and a total rollback of state taxes will cause them to lose around Rs 10000 crores annually. Don't think that would be happening either. Some Congress ruled states might do some posturing with a Rs 1.5 reduction or even less. But it is what it is, simply posturing.

Just a thought.

As I see, there are three parties to this - common man, the governement nd the OMCs (remember, they are again a part of the governement).

Why can't the government follow a variable taxation method. Have x% when crude oil is below a certain level and y% when crude oil is above that level; keep the total to a manageable level. That way, the government, the common man and the OMCs get to share the burden. It is another matter that the fuel taxes in India are one of the highest in the world; add to that poor efficiency and age old logistical systems.

Fuel price, especially in India is such a critical parameter that the government needs to be sensitive to it.

Where are the politicians who care for the suffering of the country's citizens? Is it fair to pursue a "growth at any cost" policy? Siggghhhh :-(

Vijay

Dear friend, think using your brain not with your heart.

1)Selling diesel in the black market is way more difficult than using some domestic cylinders at hotels. It has direct contact with the public and it will be very easy to spot such sellers.

2)I have no doubt that cops will start catching the offenders because it's much easier than getting into the unhygienic kitchens of every hotel in the city. It's very easy to spot. TBHPians generally have an attitude that will demoralize even the best cops out there. I'm not a great fan of that.

3)Yes there are people who are willing to run their vehicles even on kerosene. But they don't even constitute 10% of the diesel car owners.

There are Swift diesels, Ritz diesels, Beat diesels, Figo diesels, Punto diesels etc etc. Now show me one guy who is willing to fill kerosene in a car like that. Most of the consumers are office goers and gentlemen who will never run to a lorry guy to get adulterated fuel just to save Rs.10. Even with the high price of petrol, I don't know pf any petrol car owner who is running around to get some adulterated fuel at a lower price.

In a country with such huge population it's impossible to create a plan that is 100% efficient. All we can do is make it as efficient as possible.

Your way of thinking makes me laugh. Apartment complex buying an old truck?:uncontrol First of all tell the other guys that the minimum punishment for doing this is 1 year in jail. And within a few minutes you will be alone in the apartment complex's parking area with the truck. And by the way, did you think about the price of the old truck? That would be enough to run a car for more than one lakh km!

Jokes apart, I still think it's practical. I'm not talking about Rs.100 hike in diesel price buddy. Just Rs.10-12 which the diesel guys can afford. Even with such a hike diesel cars will be much more economical than petrol cars because of the price + mileage factor. As I said a Rs.250-350 increase in fuel bills is not gonna affect the majority of the people who own diesel vehicles and that definitely wont force them to approach some black market guy.

A pessimistic mind is the biggest hurdle a man has to jump if he is to succeed.

As widely predicted here it looks as if the price drama is running on the expected lines. Congress hints at partial rollback according to TOI.

Petrol price hike: Congress hints at partial rollback, opposition calls for bandh on May 31 - The Times of India

I am sure i might not be right but some thoughts. It pains to see the hikes, one side you deal with corruption, pathetic facilites and other side you are paying more and more for enjoying the pathetic facility.

Point no. 1

Subsidies should stop - I think the habit of subsidising fuel is not right from the economic perspective. It would have probably made sense when the country was not having much growth in the 70s, 80s. Things have changed, but this last minute surprise is what is killing us. They could have removed subsidies long back and started using the money in building infrastructure and public transport before the development boom happened. All political parties are responsible for the lack of implementing the above. I dont think any of them are really growth and future focussed (except themselves and families).

Point no. 2.

The petrol prices have not hurt (even diesel prices wont) people. I was just watching today, even when there are signals which shows 120s waiting time, people do not even bother to switch their vehicles off. Cars were running on ac, two wheelers being idled :Shockked:. Saw couple of cars parked in the basement of our office as well as open parking which were running idle so that the person inside could enjoy AC (specifically petrol cars).

The political parties reacting now and making a big cry is absurd. Where they sleeping all these days ? They could have pulled the government down by making them responsible for lack of infrastructure projects, public transit systems etc. But when all parties, regardless, are worried about infighting, corrupting, looting, this is all would happen. Some day the prices of everything would increase, that's basic economics.

If government's intention is to reduce private transport dependability then their intention is good but its not useful till public transport improves 1000 times than what it is now (even 1000 times might be low considering how dismal the situation is). And then there is bandh's and hartals scheduled for the next few days, who is going to get benefited ?

:OT I am sure we would have not reacted even if the fuel prices go to Rs. 200/liter had the infrastructure been world class.

Someone had asked for the reference and link to the information that had been posted. The breakup cost of petrol and diesel.

Here are the links straight from Ministry of Petroleum.

http://ppac.org.in/WRITEREADDATA/PS_oil_prices.pdf

PPAC

The desired price for Diesel is around Rs.47.11, so it’s currently underpriced a little. Not as much as Government makes it out to be. The only thing is that people are not paying huge duty and taxes on this. However, the Oil companies are selling it to the dealer at Rs.33.47 and hence the loss (or under recovery). The difference between the retail price Rs.41 and Rs.33.47 is excise duty, vat, dealer commission etc.

http://ppac.org.in/writereaddata/Pri...20Products.pdf

Now for Petrol there is no under-recovery. Here is the breakup. The Oil companies get it for Rs.42.57 (from the refineries) and sell it to the dealers for Rs.44.50. Add on average Rs.30 on taxes and that’s the price you pay at the pump, i.e. ~ Rs.75. So we are paying a little more than 65% in taxes when we buy petrol.

https://iocl.com/Products/PriceBuild...ldup_of_MS.pdf

Now there are a lot of factors to this, blame it on crude oil prices, falling rupee, inflation, Iran, blah blah, but the biggest reason I feel is incompetent tax collection from Government. Yes, people who are employed (salaried class) pay their taxes. However, Indian Government just doesn’t have a mechanism in place to collect proper taxes from the rest. Easiest way is to get it from the petrol stations, for each and every litre you fill.

This has been the biggest problem for our country.

It is not.. If I were to think from my heart, I would have to agree to what you say. I would love to have with the straight-shooting outlook you have.

Think of it: You need to set up a separate supply line from refinery to pump (if some sort of dye is to be used to identify). The pumps would need two storage tanks instead of one which they have. You need supply planning to be different. We are talking about 40K+ pumps spread across the country. The devil is in details. How many years would we take to set up at all these (how many would have space for one more tank?)

People are not afraid of doing all these: Kolkota has/had a black market to fill auto with domestic LPG (See link : http://articles.timesofindia.indiati...free-treatment ). Do you think this would have sprung up overnight? Or, by which law book is a Jugaad legal? yet it runs (see link : http://www.team-bhp.com/forum/commer...66-jugaad.html ).

For all you know, a second (well-multi hand) 407 would be available in thousands. In retrospect, rather than going that far, I would rather bribe the pump guy to fill in direct to the car! (Fine, he can take 2-5 rs/ltr!).

Who would nudge the politicians to make a law that would prick them? (We expect them to pay higher too?!).

All said, how many bhp-ians use a LPG-retrofitted Activa or even Splendor? Yet, it is popular in TN at least. All the law enforcement clamor happens in cities, once out of cities, the rules are skewed.

Yes, it is feasible to create a distribution mechanism to distribute same fuel to two classes and price differently. But, such a differentiation with the current set of morons as policy makers and enforcement agencies would happen only in dream (and in reality politicians would have one more avenue to make money).

On the other hand, if we have so capable heads that all these can be surmounted by legal framework and plan / enforce effectively, we wouldn't be in this situation in the first place.



PS: I assume we not naive to have same liquid (no dye) or dye addition at pump point!.

Under recovery for kerosene and LPG make sense as they are sold below cost price. For diesel, the companies are forced to sell at a lower price because of VAT and taxes. Now the center doesn't charge much tax on diesel but it is the states which are becoming fat cats charging pretty high taxes on diesel. Of course petrol is their main cash cow. So the notion of an under recovery for diesel and petrol is a total misnomer in the face of taxes. Actually the center should stop compensating the oil companies for the under recoveries on diesel which is nothing but an indirect way of transferring money from the center to the state coffers. Let the states deal with the fallout of higher prices of diesel. IMO the political parties at the state level who are crying wolf share an equal amount of blame for the high prices of petrol and diesel. Its time their bluff was called too.