Petrol & Diesel Prices Across India - Why this disparity in fuel prices ?
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Why cant we have a single price for auto fuels across the country?
For example a pack of Gold Flake Kings cost Rs.38.00 whether you buy it kashmir or kanyakumari... right.
I dont understand how the GOVT can charge 40% of the petrol price as various taxes.
We in bangalore pay the highest for a litre of petrol & diesel
the petrol prices across the nation are: Prices in Metros
Petrol Prices Across State Capitals North
Guw ahati 45.48
Patna 46.45 Portblair 37.82 - cheapest in India
South Bangalore 50.58 - costliest in India
the deisel prices across the nation are:
Prices in Metros
Guwahati 31.38 Imphal 30.16 - cheapest in India
Port blair 29.20
South Bangalore 35.23- costliest in India
All these data has been compiled from Indian Oil website-www.iocl.com
As per this information
A litre of petrol costs highest in Bangalore at Rs.50.58 & costs cheapest in Port Blair(Andaman & Nicobar) at Rs.37.82.
A litre of diesel costs highest in Bangalore at Rs.35.23 & costs cheapest in Port Blair(Andaman & Nicobar) at Rs.29.20.
As none of us could drive down to Port Blair to tank up our cars & bikes, the cheapest petrol/litre on the Indian mainland would be Pondicherry at Rs.41.70
The cheapest diesel/litre on the Indian mainland would be Imphal at Rs.30.16 ( Infact diesel is cheapest in the North-Eastern states, wonder why? )
As a Bangalorean I just cant digest the fact that we in the city pay the highest.
So what I try to do is avoid tanking up in bangalore when travelling out of state. Atleast I say 3-4 rupees/litre.
The difference is due to transportation cost and tax difference. For example, when 25% taxes are levied on goods costing 11 and 12, there is a cascading effect on customer price. Got the idea?
Add to this the varying rates of taxes across states. In KA, there is some cess/levy, in addition to normal tax.
Regardign cigarettes and other packaged items, the law requires the manufacturer to print the price on the package and publish the prices in papers. If they start printing different prices for each state, it going to cost them a bomb - the packaging is going to increase in size exponentially.
Fuel is not a packaged commodity, hence the difference.
Btw, for the curious, Pondicherry has a small territory within Kerala - Mahe. NH 17 passes through this, and the roads are lined with motor spirit bunks and "spirit for humans" vends. All vehicles passing through Mahe and those registered in Kerala and used around Mahe enter Mahe, fuel and proceed. We usually tank up upon entering Mahe. The difference in price is very marked.
Interestingly, the Mahe - Kerala border is the only place where there is a checkpost for pedestrians. For those walking out of the Mahe territory with luggage are checked by the Kerala authorities since Kerala has a rule which say a person cannot store more than 2 liters or so of spirit. (I am not sure of the quantity - I have no use for the rule since I am not interested in non-motor spirit).
Dude, these differences is because of freight charges, taxes, cesses instroduced by state govts etc. Also, their is difference in fuel prices in the same stae itself. This is due to freight charges (as the distances will not be same from one destination to another destination) like if the fule is transported from Chennai, te freight charges will be less to Bangalore than the freight charges to Gulbarga.
BTW, govt is meeting tomorrow for the price revision of petrol and diesel throughout the country. After the hike is announced, hope, the governer in Karnataka acts swiftly and reduce the cesses/sales tax charged on the petrol so that it will not pinch us too much.
Freight charges have very little to do with it. By that logic Karnataka would have cheaper fuel before the local/state taxes than Tamil Nadu as the refinery is at Mangalore, which also has a port where crude oil is imported. However, this is not the case - pricing in the two states gives no consideration to transport costs.
The tax rates are amongst the highest in Karnataka. On top of that Bangalore charges a 5% entry tax - pushing it to the top spot on fuel pricing.
There is also a difference between Euro III/ Euro II petro. Metros have to sell Euro III fuel, which is 91 octane and slightly more expensive. This also explains the higher prices in some larger cities.
Well,petroleum pricing in India,is almost as complicated and convoluted as things can get for the past one year and half, I'm struggling to get a hold of it. But not only the freight, and duties, there are at least a hundred elements in the price buildup for the end price. However the following ones make the key differences
Crude prices+ Refining Margins( fixed by GOI) will give you the Refinery transfer price( RTP).
Now Add Excise duty to it, and transportation, Educational Cess of some 2 Rs/Ltr, Some Kind of higway and infrastructure cess(forgot the correct name for it) which is even higher,You'll End up with the approx price at UTs like Mahe, PY, Delhi etc. (The state specific taxes and duties are not levied)
In all other places youl have to add the vat, and octroi and other state, district specific duties youll get the price for the market.
Now, since freight does play a major role in the cost, Those areas nearer to Refineries will get lower prices, as a rule of thumb (thats why cochin has a lower rate compared to Trivandrum)
One funny fact is that, The oil prices for all Three companies at any given market is the same, while some may incurr lower transportation (due to placement of depots, staging point etc), and others, higher. They build a pool, for all three companies, where they payout the over recoveries, to meet the under recovery! (Funny and also stupid), I mean if they can make a pool for this, why dont the price it uniformly across the country pool it and take home their slices of the pie? I dont want to complicat the matter further,but hope th question was answered!