[rajneeesh]

Originally Posted by arun_kun

Saw in one of the news site that the retail price wont change. Instead of lowering the retail price in the backdrop of recent fall in crude oil price, govt opted to fill their pockets.

Edit: Source: http://www.thehindu.com/news/nationa...?homepage=true

The government has elections on its mind. So they have reduced the price of LPG by Rs 113 per cylinder (after the 12 subsidised) refills. Finance Minister Jaitley is also trying to keep the Fiscal defecit within 4.1 % target and the additional excise duty on fuel is a step in this direction

[rnidumolu]

Originally Posted by arun_kun

Saw in one of the news site that the retail price wont change. Instead of lowering the retail price in the backdrop of recent fall in crude oil price, govt opted to fill their pockets.

So finally "Ache din aa gaye hai", but for Government and not for the common man

I feel, the common man of India got cheated again and was forced to pay the same amount what he was used to pay. May be the government is thinking he is not eligible to get the benefit and let him suffer.

I feel, a very bad move by Modi Government for the second time.

[el lobo 6061]

My 2 paisa.

Government of India is doing the right thing. Why?

• It's necessary to meet the deficit. That is Expenditure > Revenue.
• Brent prices are sliding down, but how long? OPEC countries other than KSA aren't making profit and how will they meet their Government expenditure.
• Less fuel price would result in more cars on road. Leading to more traffic & pollution.
• You all want to enjoy short term benefit but what about long term deficit which Government has to fill in?

But I hope when Brent stabilizes around $80, Government reduces excise and doesn't increase price.

[gsurya]

All this jugglery on fuel prices is worthwhile & justifiable if and only if the Fin Min brings Fuel into the ambit of GST & gets it done. This will really pay off in the long term. No better time than now in the last decade with crude prices being so low.

Nevertheless, funny now to read what these same guys had said a couple of years back

http://timesofindia.indiatimes.com/c...w/13580199.cms

[longhorn]

These very same bunch of clowns, while sitting in the opposition less than a year back, were crying their lungs out against increasing prices when crude oil hit 114 dollars per barrel and when the then govt increased fuel prices. Why didn't they think about the trade deficit then. Now, when its time to put their money where their mouth is, people talk of trade deficit, inflation and what not. If there is no intent to deregulate fuel prices in letter and spirit, why do all this tamasha. Why not accept that this is your cash cow and say you will not deregulate as long as prices decline, but will do it when prices start hitting the roof again. Why use the backdoor to control prices.

[vigneshA]

Originally Posted by longhorn

. If there is no intent to deregulate fuel prices in letter and spirit, why do all this tamasha. Why not accept that this is your cash cow and say you will not deregulate as long as prices decline, but will do it when prices start hitting the roof again. Why use the backdoor to control prices.

Nope - the prices are deregulated. Its the tax thats getting adjusted.
If you look at the Indian oil consumption - its fairly inelastic - so a reduced fuel price would lead to reduced tax revenue for the govt.

I feel they can rather work out a variable tax system and make it permanent, with decreasing rate slabs on increased crude oil to kick in automatically.

[civic-sense]

Originally Posted by vigneshA

Nope - the prices are deregulated. Its the tax thats getting adjusted.
If you look at the Indian oil consumption - its fairly inelastic - so a reduced fuel price would lead to reduced tax revenue for the govt.

Along with tax adjustments, they are making the OMCs absorb the price difference so that final price remains unchanged. So this deregulation is a big farce.

[i10]

Two articles by ET and TOI highlighting the pricing farce. For once, they get my kudos for making it a front pager (even if on their website)

Oil decontrol sham: Crude price at 5-year low, but not for you

The government on Tuesday raised basic excise duty on petrol and diesel for the second time in roughly two weeks to mop up gains made by fuel retailers from a sharp fall in global crude prices, a benefit that was supposed to be passed on to consumers under a much touted decontrol of prices in the sector.

.
.
.

The government is estimated to mop up Rs 20,000-21,000 crore per year from the two rounds of excise duty revisions. In a true market pricing regime, this benefit should be going to consumers by way of hefty reduction in prices. The paltry price cuts announced on Sunday and the move to raise excise duty have dashed the hopes of consumers eyeing a substantial reduction in their fuel bill.

Full article at: http://timesofindia.indiatimes.com/b...w/45354437.cms

Crude Joke: Fuel price cut not as steep as global fall



Oil consumers have so far got only a fraction of the steep fall in crude prices.

Brent crude has dropped about 40% since June, but the price of petrol, diesel, jet fuel and commercial LPG have fallen barely 8%-17%. Prices are down 17% for commercial cooking gas, 14% for aviation turbine fuel (ATF), 11% for petrol, and 8% for diesel.

Full article at:
http://economictimes.indiatimes.com/...w/45341512.cms

[Vik0728]

Yahoo have posted an article on their home page that provides fuel prices across big cities in India.

The Link



O.T - If there was any doubt why GOA still rocks, I am sure it will be shattered looking at the fuel prices there !!

[lurker]

Originally Posted by civic-sense

Along with tax adjustments, they are making the OMCs absorb the price difference so that final price remains unchanged. So this deregulation is a big farce.

deregulation was always going to be a farce in India. Some things are just too lucrative to let go. Just like BCCI cricket and IPL are going to be a big farce because you can never keep betting or fixing away from it. Deregulation was always going to mean increase along with global prices and freedom to increase from week to week but no decrease.

folks who were jumping up and down on announcement of 'deregulation' just simply failed to see this fact. Also we have to factor in play by major 'karporates' like Reliance, Shell etc in oil pricing. Reliance is processing lot of diesel for IOC etc. IOC refineries have not expanded capacities for last many years even though consumption has increased. And in India wherever this Reliance comes into play, decisions move lightening fast.

Even lackadaisical courts often give out judgements within the month, when the case involves Reliance as an interested party. Such speed is not usually seen in this country. It is not a sign of effficiency, if you are still unable to get point, but the extent of corruption and rot that has set in.

[sgiitk]

@lurker; I think IOC is still incapable for producing BSIV in adequate quantities, forget Euro IV and V. I suspect IOC is buying Euro-V Diesel from Reliance and then 'cutting' their own stuff with it to make is BSIV. I remember in the early days of BS-I or II one major manufacturer was using Reliance diesel to get their cars under the limits. Also, BSV has been postponed by 5-10 years (it was due in 2015) due to the inability of PSU refineries to produce BSV fuels. Let then extend BS-IV across the land in this period.

I may add that I have not seen any Reliance pumps being unmasked for restarting sales.

As for taxation increase I may not like it but I am not surprised, sine in the days of $120 Brent Excise was reduced so they have to claw it back. Also, it is only Excise which goes directly to the Centre, since VAT is mostly pocketed by the states.

[merve_extreme]

Originally Posted by vigneshA

Nope - the prices are deregulated. Its the tax thats getting adjusted.
If you look at the Indian oil consumption - its fairly inelastic - so a reduced fuel price would lead to reduced tax revenue for the govt.

I feel they can rather work out a variable tax system and make it permanent, with decreasing rate slabs on increased crude oil to kick in automatically.

The Taxes on Fuel in India are fixed in Rs.xx and not levied in percentage terms on cost of the Fuel. So a reduced fuel price will not lead to a reduced tax revenue for the government.

[joslicx]

Originally Posted by el lobo 6061

• Brent prices are sliding down, but how long? OPEC countries other than KSA aren't making profit and how will they meet their Government expenditure.

Actually even KSA needs crude at around $98 or thereabouts to meet their massive social spending. They have a warchest of about $750B in reserves which is enough for their social programs to survive for next 3 years so they arent bothered for now but question is how long!

Its a big war out there between Saudis and American shale producers. Even for Americans its a complex situation to handle - More internal production gets them out of dependence on Middle East oil (so then they can leave that region) but it also has serious ramifications on Dollar as a primary currency for trade. Its a tough act for them and oil prices are very uncertain.

Since this thread is mainly becoming a rant hotspot against/for X, Y and Z may I request the mods to create a separate Rants thread and let us only have meaningful and informative discussions over here with regards to fuel pricing. We all want cheaper petrol and diesel (who wouldnt) but there are serious arguments both for and against lower prices. Lets keep the discussions to that only and leave emotions out.

[sgiitk]

The main country opposing production cuts is KSA. The logic is why us all the time? So let them sort themselves out, and till such time we can rejoice. One other reason is that KSA wants to damage the Shale Oil game in the US, for which WTI had to go below $50.

[pgsagar]

Originally Posted by merve_extreme

The Taxes on Fuel in India are fixed in Rs.xx and not levied in percentage terms on cost of the Fuel. So a reduced fuel price will not lead to a reduced tax revenue for the government.

You are wrong Sir. It used to be that way back in 80s or so. It is called specific rate of excise duty. But soon GOI changed it to ad valorem. Ad Valorem means a "percentage of". So, now everytime price of petrol goes up, GOI nets more revenue.