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Old 23rd June 2020, 13:04   #1
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Default Fuel prices increase 16 days in a row. What the hell is happening?

Prices for petrol and diesel have been hiked for the 16th consecutive day. Petrol price was hiked by 33 paise per litre while diesel went up by 58 paise.

In 16 days, the price of petrol has gone up by Rs. 8.30 per litre and diesel by Rs. 9.46 a litre. The latest revision of the fortnightly prices is the highest since April 2002. It is said that the previous maximum for a fortnightly increase was Rs. 4-5 per litre.

In Delhi, a litre of diesel now retails for Rs. 78.55 and petrol costs Rs. 79.56 per litre. These are the peak prices of diesel and petrol since October 16 and October 4, 2018 respectively.

Almost two-thirds of the retail selling price - 64% in petrol and 63% in diesel - consists of state and central government taxes. But, unlike October 2018, when the government had cut excise duty on petrol and diesel by Rs. 1.50 per litre each and State-owned oil companies were asked to absorb another Rs. 1 a litre, there are no such moves planned this time around. The state and central authorities are busy compensating for the losses in revenue due to lockdown.

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Last edited by blackwasp : 23rd June 2020 at 13:06.
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Old 23rd June 2020, 13:29   #2
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

One side, I understand that it is required to tackle the current scenario where country has lost huge revenues

But I can't fathom out why PM Cares fund is out of RTI's reach. There is no communication of sorts on this which is disheartening
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Old 23rd June 2020, 13:31   #3
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

I have no words except to crib within myself. I am sure our voices wont be heard.
This is another easy means to milk the common man, especially the middle class.

Time and again we bring up this topic of rising prices or excise tax being increased.
Whichever the government, the same habit is followed over the years.

But this time its hurting below the belt, so keep your masks on and scream, rest assured nothing's gonna change.
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Old 23rd June 2020, 13:38   #4
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

This fact itself is bad. But the fact that prices are being hiked in spite of the fall in crude oil barrel prices is worse.

And this news is neither being popularised by the media (as it does for other news), nor being shared vastly by people on social media where all the unnecessary stuff is made viral.

Reminds me of a meme -
Petrol prices hiked for 16 days straight - Nobody bats an eye.
Tiktok banned - Everyone loses their minds.

Last edited by saisailendra : 23rd June 2020 at 13:41.
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Old 23rd June 2020, 13:47   #5
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

There was a revision of Delhi state tax last month, when petrol was hiked for around Re. 1 against Diesel which shot up to about Rs. 7. It made me wonder that diesel in Delhi is consumed mostly by upper middle class and elite class in passenger cars from Swift to higher end cars. Commercial Vehicles like Small Lorries, 3-wheelers, buses alot ply on CNG only. So Diesel is left only for the better off people. Hence, there is a disproportionate increase, as petrol is still purchased by ‘common people’ for two wheelers and smaller cars as per Delhi Govt.

As far as national prices and tax are concerned, yes the Central govt and state governments are spending A LOT on health care. Be it any state, funds are diverted to purchase Covid-Test kits, to setting up of isolation wards, granting life insurance to Medical workers.

Only yesterday, the Central Govt granted Rs. 500 crore to the Indian Army because of the China situation at a time of crisis. So yes, it’s not easy for the governments to bear so much at a time when business is going down, GST revenues have plummeted.

Fuel prices do pinch me as 2 of our cars are doing 150 kms a day but we know that it is the need of the hour. Our country is at a crisis, Arphan happened, Nisarga happened, our neighbours are in a mood to start a war, so yes the government is under alot pressure and a HUGE financial crunch, so maybe we should do our part too and hope things go back to normal.
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Old 23rd June 2020, 13:55   #6
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Petrol, diesel price today: The two fuels now cost almost the same in Delhi
Quote:
If the current trend goes on, then diesel would be more expensive in New Delhi tomorrow
In Delhi, the price gap between petrol and diesel has narrowed down to a record low of just 36 paise a litre
Never thought I'd see a day where Diesel crosses Petrol
Mumbai Petrol is in another Universe of itself

New Delhi: Petrol ₹79.76. Diesel ₹79.40
Gurgaon: Petrol ₹77.99. Diesel ₹71.76
Mumbai: Petrol ₹86.54. Diesel ₹77.76
Chennai: Petrol ₹83.04. Diesel ₹76.77
Hyderabad: Petrol ₹82.79. Diesel ₹77.60
Bengaluru: Petrol ₹82.35. Diesel ₹75.51


Source: https://www.livemint.com/news/india/...877596725.html
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Old 23rd June 2020, 13:57   #7
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

I think today's Hindu cartoon, captures what most of us are thinking:

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Old 23rd June 2020, 14:04   #8
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Milking the cow - Doesn't matter to the govt. where money comes from. Due to lockdown, spending has decreased a lot. So govt. is making up for it with increasing taxes wherever it can.

As a honest tax-payer, I hate to say it but we have to accept the fact that we have bear the burden of pretty much all kind of taxes(Property tax, Road tax, this tax, that tax etc.....list goes on).

You can always question the intent of spending but unless the changes are seen, I don't believe that money is well spent.

To convince ourself to the fact that we contributing to nation building is a consolation prize. As a fact, get used to paying taxes and probably make peace with it, because no matter which party is in power, TAX will rule.
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Old 23rd June 2020, 14:04   #9
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

A few points I would like to mention:
  1. Back in October 2019, there was a joke in my circle that we will be getting a century in 2020 related to petrol prices. At this rate of increase and the ongoing pandemic, it seems quite possible now.
  2. Since in many places the roads are still less crowded than pre-COVID era, a higher fuel efficiency is achievable, somewhat balancing out the rise in prices and not hurting our pockets much.
  3. A few days back, my neighbour was thinking to sell his pre-owned Cruze purchased a year back (this replaced an Alto 800 from late 2000s) and replace with a new Swift since his monthly fuel costs are somewhat rising since his Alto days (from around Rs. 2000 earlier to Rs. 3500-4000 now). To his dismay, I verbally calculated and simply explained him that he will not be able to recover the Rs. 5-6 lacs he invests in a new car from the higher economy judging by his running.
My 2 cents: So anyone here on the fence and simply wanting to shift to a more efficient car without any extra gains in space or safety, must really calculate well before signing the dotted line. Also, I feel it is much easier to change one's driving style for extracting a bit more from the tank, rather than getting a new vehicle for this sole purpose. Its always better to be prepared for a rainy day.

Last edited by Researcher : 23rd June 2020 at 14:08.
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Old 23rd June 2020, 14:26   #10
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

At this point, with the lockdown etc in current situation, tax earned from fuel is one of the sureshot, steady income for the government, so it isn't surprising that they're revising it so frequently.

The consumer is always the loser in this fuel pricing game. Here's a recent article I came across, of course we all know and have debated this to death on several occasions earlier

Source: Indian express
Link
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Old 23rd June 2020, 14:29   #11
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Here petrol/diesel prices are inversely proportional to crude oil prices.

The only reason I can think of is that, government is in dire need on money and , petrol/diesel are one such thing for which prices are going down in international market, so why not increase the taxes and get some extra money.
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Old 23rd June 2020, 14:37   #12
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

... and then they blame the millenials for not buying cars.

Jokes aside, will all kinds of tax revenues taking a hit, GOI has to find the money from somewhere. This is the easiest route. But in the present scenario when everyone is driving much less than before, at what point will the raised prices make up for lower consumption? 150? 200?

In related news, I also saw a proposal to tax withdrawals from banks over 5000(?).

I can understand the country going through a bad time, and everyone is doing what they can to help. This is a time where the citizens also need some help from the Govt. It can't be a one way street all the time.

Do we not have any emergency reserves that can be utilized at this point and not be solely depend on tax revenues? Basically, balance the two, and not depelete any one of them dry.
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Old 23rd June 2020, 14:52   #13
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Quote:
Originally Posted by INJAXN View Post
Here petrol/diesel prices are inversely proportional to crude oil prices.

The only reason I can think of is that, government is in dire need on money and , petrol/diesel are one such thing for which prices are going down in international market, so why not increase the taxes and get some extra money.
Well, they are. We were on the verge of a financial crisis before the pandemic. The situation could have only deteriorated from there.

On the one hand, I understand why they are doing this, since other sources of revenue have dried up.

But on the other hand, being taxed so much in a country where my taxes are so inefficiently spent does feel suffocating some times.
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Old 23rd June 2020, 14:57   #14
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

One can argue these steep price hikes are to increase revenue in view of pandemic and to tide over the tight fiscal situation. By the way, wasn't this the case during pre Covid times too? I can't recollect any time where the benefit of fall in crude oil prices were passed onto the end consumers. For govt, this has been a golden goose that lay golden eggs since time immemorial.

Last edited by Bibendum90949 : 23rd June 2020 at 14:59.
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Old 23rd June 2020, 15:06   #15
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

  • Govt increasing the tax when crude prices going down to create a fund to shield from later price hikes, but taxes once charged is never get reversed.
  • They increase the fuel prices and somebody from some corner cites the reason as a possible threat of a war. The war will never come (for good), and the hikes will never go.
  • Govt taxing people for road / infrastructure development. There will not be such drastic developments happening comparably. But if that happens even in the form of widening and renaming, there comes the toll.
  • They demonitise your money citing someone's black money. Your time and money is gone but black money won't.
  • They bring GST citing easy tax structure, and it becomes the most complex thing for many.

There will come a time when these discussions about fuel price hikes will be termed as "against the interests of the nation". So, mods, please delete this thread, or merge with "Official Fuel Prices Thread".

Last edited by romeomidhun : 23rd June 2020 at 15:27.
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