[msdivy]

When the crude fell to $40, in a free market, the benefits of reduction in input cost would have been passed on to the consumers. But Govt meddled with the fuel prices and it raised the taxes so that selling price remained as when crude was $140. It was seen as an ingenuity to raise capital for Govt schemes.

Crude at $40 was a good luck bonanza, a one time gift. As it happens, Govt instead considered this as additional regular source of revenue and made plans to utilise the additional taxes for Govt spending.

Now crude has reached $80. People are experiencing the additional taxes. Govt cannot reduce taxes since it will affect its fiscal policy. Whether to retain taxes, or compromise on welfare schemes, Govt is caught in the quagmire of its own making.

[nakul0888]

Had a lot of hopes when this govt took charge what with all the “ govt has no business in business “ talks from the man himself . But what complete basket case has this turned out to be . Crude oil is about half the rate at which it was during the financial crisis yet prices in India has never been high before. In fact during 2016 when crude oil was cheap as chips we didn’t see a single damn rupee of benefit. The government refused to lower taxes giving a horse manure excuse of “ preventing volatile fluctuation of prices and saving up a cushion for later years” whatever the hell thats supposed to mean . It’s not just petrol is it ? Our cars are taxed as exorbitantly as our fuel and are there any roads or footpaths or sewers or traffic lights or street lights to show for it ? Nope. Coupled this with the whole demonetisation stunt, soaring govt deficits , free falling rupee, NPA crisis , I have lost all hope in our so called leaders governance from all sides of the aisle.

[PGA]

Fiscal policy and welfare schemes etc is a mumbo jumbo being peddled around. Govt's do not run on such subjectivities. Every year with greater fan fare a budget is made by the Govt of the day wherein it declares what where and how much is it going to spend in the forthcoming year and where and how much is it likely to accrue.
The windfall which started with reduced prices not only continues but is now paying even greater dividends to the Govt as the taxes are a percentage of price and not an absolute figure.
As stated by the Govt the fiscal deficit is only going to be maintained and not improved by this additional revenue, implying Govt is spending this money on something that it did not budget for.

Is this additional expenditure not at an unjustified cost to it's citizens?

[extreme_torque]

Originally Posted by PGA

Fiscal policy and welfare schemes etc is a mumbo jumbo being peddled around. Govt's do not run on such subjectivities. Every year with greater fan fare a budget is made by the Govt of the day wherein it declares what where and how much is it going to spend in the forthcoming year and where and how much is it likely to accrue.
The windfall which started with reduced prices not only continues but is now paying even greater dividends to the Govt as the taxes are a percentage of price and not an absolute figure.
As stated by the Govt the fiscal deficit is only going to be maintained and not improved by this additional revenue, implying Govt is spending this money on something that it did not budget for.

Is this additional expenditure not at an unjustified cost to it's citizens?

I guess the citizens too have to vote from their wallet come the election time. We also know who this government is working for in reality. How would we ever have a world class MNC company with the rest of the world wanting its wares when you can much easily earn billion of dollars being a crony. Case is point, a certain 10 day old defense company with absolutely no experience in the field (I would argue the company was created for the contract than the other way around), the parent of which is under huge debts being given a plum defense contract on a platter. All this largesse will have to be sponsored by someone.

[saket77]

An article published on moneycontrol on whether the 'oil bonds' are the reason for the high fuel prices. This clears the air a lot for them who would like to know in detail:

https://www.moneycontrol.com/news/bu...s-2984731.html

[longhorn]

Originally Posted by saket77

An article published on moneycontrol on whether the 'oil bonds' are the reason for the high fuel prices. This clears the air a lot for them who would like to know in detail:

https://www.moneycontrol.com/news/bu...s-2984731.html

Yes it does. The NDA have paid around 3500 crores in two installments, but more importantly and falsely (as is the norm with them), claimed to have paid interest on 1.44 lakh crores.

Excerpts from the link to the article shared:

According to the annexure – 6E of the Budget documents for 2016-17, 2017-18, and 2018-19, the total value of special securities issued to oil market companies in lieu of subsidies has remained constant. More importantly, only two bonds matured during this period, contradicting the NDA government’s claim that high oil prices were on account of interest payouts on outstanding bonds worth Rs 1.44 lakh crore. With the lion's share of interest payments on oil bonds yet to mature, it is incorrect to say that these payouts have driven up prices. As they are spread over a period of time, the debt burden will not be as severe as it is being made out to be.

Further key excerpts :
In a question raised in Lok Sabha in 2017, the Petroleum Minister had conceded that central excise duty increased from Rs 9.48 per litre in April 2014 to Rs 19.48 per litre in October 2017. Likewise, excise duty collected by the centre on diesel rose 330 percent from Rs 3.56 per litre in April 2014 to Rs 15.33 in October 2017.

The depreciation of the rupee's value is also contributing to escalating fuel prices. India imports majority of its oil, and a weakening rupee will translate into higher costs. A corollary of this is that tax collection will further go up. Since retail prices are now linked to the global market, higher fuel prices will translate into heftier fuel bills for customers lining up to fill tanks at fuel stations. Since excise duty is a percentage of the base price at which fuel is exported, the greater the price of acquiring fuel, more money will go into the government's kitty

[volkman10]

Fuel stations upgrade dispensers to display three-digit rates.

Link

[Sheel]

Originally Posted by volkman10

Fuel stations upgrade dispensers to display three-digit rates.

Link

Sign of things to come

Wish there was a permission to add further emoticons/smilies.

[CrAzY dRiVeR]

Originally Posted by volkman10

Fuel stations upgrade dispensers to display three-digit rates.

Those days are not too far ahead I feel!

But surely will be a big psychological barrier for the society. There will be a lot of unrest atleast for a short period for sure.

[jetsetgo08]

Pumps being calibrated for century is ominous. Didn't expect it to be this soon.

Read a hilarious comment in some news website, that all the motorists will have to lift their helmet in the air every time they refill petrol once the price/liter reaches century.

[RohanDheman]

Originally Posted by volkman10

Fuel stations upgrade dispensers to display three-digit rates.

Link

I have been fueling with 97 octane in Delhi at over Rs.100 for about 3 weeks now. The BP pumps here were fully capable for displaying Rs.100 and above.

[gk1234]

Refueled my Superb’s near-empty tank till cut-off today. While it was satisfying to see the fuel meter’s needle swing from E to F, my wallet bore the brunt of my excitement. It cost me ₹5300. I get a city mileage of approx. 7-8.5 kmpl, and probably twice as much on the highways, but since I drive in the city 90% of the time, I average out 9 kmpl, giving me a range of 600 km per full tank. In effect, I spend ₹5300 for 600 kms.



I really don’t know what to make of this information, but dear lord do I miss cheaper fuel now more than ever.

[lurker]

this rs.100/litre petrol gives me the impression that entire economy is teetering on the edge and can collapse anytime. This is definitely not sustainable policy in a country like India where each and every citizen doesn't earn lakhs of rupees every month to pay 5000 for every petrol tankup.

There is always some kind of instability going on in India at every time, either it is in form of high prices for pulses or onion or else there some kind of fuel pricing scam being perpetrated or dollar has risen through the sky and rupee has fallen through into kms deep dark hole increasing prices of most automobiles & euro/jap/korean cars and essential imports.

[motorworks]

The 100 mark is nearly there! I had visited shell yday to fill petrol for my wifeys Brio and Shell V power was Rs. 96! The regular petrol was itself Rs.88, which i think is also more than what the govt owned companies charge. If Im not wrong, Karnataka govt reduced some taxes on fuel and hence petrol must be around Rs.84 or Rs.85.

Earlier I used to not worry about shell vs govt oil company prices, but now it looks like I got to go back to Indian oil or Bharat petroleum outlets for sure! No more V power at Shell.

How about diesel? Is shell still more expensive than the PSU outlets in Bangalore? I got to fill up my Creta diesel in a day or two!

[Sheel]

90.93. Last refill was at 89.77. Pump attendent was going for a tankful (as usual), asked him politely to fill for an amount of Rs. 1,000 which amounted to 11 liters only. He too gave a wry smile and I was grumpy as ever.
Sad.