[NetfreakBombay]

Originally Posted by sgiitk

What is interesting is the Goa scene, is petrol now cheaper?

Petrol is now cheaper in Goa (by few paise)

http://businesstoday.intoday.in/stor.../1/194869.html

Petrol has become cheaper than diesel in Goa after the government hiked the diesel prices by Rs 1.02 per litre on Friday. This is the fourth increase in rates this year.

Petrol is currently priced at Rs 52.10 whereas a hike of 90 paise (Rs 1.09 post state government tax) takes diesel price to Rs 52.70.

[Desi Dybuk]

Originally Posted by sgiitk

So 10-20 may be the normal band. What is interesting is the Goa scene, is petrol now cheaper?

As per mypetrolprice.com, Petrol is 60.XX & Diesel is 63.XX per liter.

I'm jealous of Goans: Chill culture, awesome beaches & cheap Petrol...

[sgiitk]

Saw in today's paper. Reliance is planning to reopen its outlets by Diwali and both Reliance and Essar have big expansion plans.

[blacksport]

Originally Posted by Desi Dybuk

As per mypetrolprice.com, Petrol is 60.XX & Diesel is 63.XX per liter.

I'm jealous of Goans: Chill culture, awesome beaches & cheap Petrol...

It's state taxes that is keeping diesel cheaper than petrol. I am waiting for that day other states emulate Goa.

[lurker]

Originally Posted by sgiitk

Saw in today's paper. Reliance is planning to reopen its outlets by Diwali and both Reliance and Essar have big expansion plans.

So isn't it obvious, that the whole plan (behind so-called 'deregulation') was to increase prices to such a level so as to make pumps operated by Reliance again profitable.

In India, deregulation has only meant increase in prices and no decrease in prices when global crude prices fall. Whom does this benefit ?

[sgiitk]

Originally Posted by lurker

So isn't it obvious, that the whole plan (behind so-called 'deregulation') was to increase prices to such a level so as to make pumps operated by Reliance again profitable.

In India, deregulation has only meant increase in prices and no decrease in prices when global crude prices fall. Whom does this benefit ?

I do not think 1 is true, else they would have also been given the subsidy.

2, Petrol has fallen of late.

I expect once deregulation is announced the Re may improve by 50-100p on the sentiment.

[lurker]

>Petrol has fallen of late.

But why has petrol fallen ? Has it fallen in line with international crude prices ? Isn't the fall in petrol only a face saving gimmick & done only when it becomes unavoidable.

Giving subsidy to private players will only invite open protests by all fringe political groups like AAP, NGOs etc. It will open the govt to lot of internal pressure, thus they are hesitant 'to be seen' doing so. So it's a non-starter anyways.

[gsurya]

If & when both Petrol & Diesel are fully decontrolled, private players like Reliance, Essar etc will automatically be benefited since they can price their fuel closer to PSU Oil cos.

PSU Oil cos will still carry the burden of Kerosene, LPG/CNG subsidies until these are also fully removed & hence will be disadvantaged compared to retail private oil cos.

[adimicra]

Originally Posted by gsurya

If & when both Petrol & Diesel are fully decontrolled, private players like Reliance, Essar etc will automatically be benefited since they can price their fuel closer to PSU Oil cos.

PSU Oil cos will still carry the burden of Kerosene, LPG/CNG subsidies until these are also fully removed & hence will be disadvantaged compared to retail private oil cos.

That's not a correct statement.
The PSUs are not disadvantaged - they receive the subsidy amount from the govt. The private companies don't have that benefit. So, they can only compete when things are deregulated.

[saket77]

Originally Posted by gsurya

If & when both Petrol & Diesel are fully decontrolled, private players like Reliance, Essar etc will automatically be benefited since they can price their fuel closer to PSU Oil cos.

PSU Oil cos will still carry the burden of Kerosene, LPG/CNG subsidies until these are also fully removed & hence will be disadvantaged compared to retail private oil cos.

This is called turning tables. There was a time when all private players had to pull down the shutters to their business since the subsidised fuel was way cheaper at PSU oil pumps.

Now, the tables have turned. Petrol & Diesel are now almost completely deregulated. The private players will have the cushion to play around the crude prices in the international market while the PSUs will have to get clearances from their political bosses for every hike or price cut.

[gsurya]

Originally Posted by adimicra

That's not a correct statement.
The PSUs are not disadvantaged - they receive the subsidy amount from the govt. The private companies don't have that benefit. So, they can only compete when things are deregulated.

Govt doesnt pay PSU subsidies on time, in fact they ask them to 'adjust' most of it in their balance sheet. Deregulation will help them as for petrol / diesel revenue they no longer have to depend on Central Govt.

Kerosene / LPG / CNG will be the only fuels that they will have to subsidize & then chase Govt for getting the refund of subsidy.

[sgiitk]

I will not be surprised if (and a big one at that) at some point the private chaps start undercutting the PSUs. Their cost of production may be lower. Reliance had 14-15% of the Diesel market, primarily because (I think) the truck driver had less scope for hanky-panky.Competition is always good.

[Desi Dybuk]

Originally Posted by sgiitk

I will not be surprised if (and a big one at that) at some point the private chaps start undercutting the PSUs. Their cost of production may be lower. Reliance had 14-15% of the Diesel market, primarily because (I think) the truck driver had less scope for hanky-panky.Competition is always good.

Even if prices remain comparable to PSUs, the private players can compete on other points such as clean restrooms, working air fillers, redeemable loyalty points etc. Hopefully, the days of the dirty petrol PSU bunks might be over.

[sgiitk]

Read that the 'basket' is under $100 and the deficit will be Re.0.30 or so after September 1, assuming a static Brent price and exchange rate scenario.

[a_myth]

Originally Posted by Desi Dybuk

As per mypetrolprice.com, Petrol is 60.XX & Diesel is 63.XX per liter.

I'm jealous of Goans: Chill culture, awesome beaches & cheap Petrol...

You are correct. Petrol cost is Rs. 60.4X and Diesel is 63.4X. Couple this with relatively light traffic during non peak hours and most part of the year during the off tourist season, vehicle fuel efficiency is also higher compared to most of the metros/other cities. Win Win situation for Goans