[shankar.balan]

In Europe/ UK , sometimes one gets cheaper gas from different filling stations owned , franchised and operated by different refining companies.
Ive seen this in some places.

This is also partially because real estate costs in different parts of the same cities would be different and those countries allow for differential pricing in different areas within the same city/ province, county, state, country. They follow an RRP (Recommended Retail Price) or SRP (Suggested Retail Price) system.

In India however, for all Branded products, we have an MRP rule and we dont allow differential pricing on account of differential real estate costs or whatever - however, the same logic ideally ought to apply to Fuel as well, since Fuel is also a Branded Product - but unfortunately this dichotomy exists in the system.

I suppose if they de-control the pricing, all the refining companies can jump into the fray offering good deals and special promo pricing etc, special weekend pricing, highway/ suburban pricing etc the same way that the organized retail setups are doing across the country for other products. Competition, in this sense, will drive benefit to the consumers and the power shift will take place in favour of the consumer, where now it is in the hands of the seller/ retailer/ govt.

In the above scenario, perhaps companies like Reliance will come back into retailing fuel - as are Essar, Shell and Mangalore Refineries - (HI Q). Perhaps even Madras Refineries and Cochin Refineries could get into direct retail.

Consumers can then choose whether to drive that extra mile or two for buying cheaper fuel, or for reasons of convenience, simply pay the premium in price and fill up closer to their homes or their workplaces.

I am not sure what holds the govt back from allowing healthy competition in this manner.

Do share your views guys...

[amtak]

Originally Posted by shankar.balan

In Europe/ UK , sometimes one gets cheaper gas from different filling stations owned , franchised and operated by different refining companies.
Ive seen this in some places.

This is also partially because real estate costs in different parts of the same cities would be different and those countries allow for differential pricing in different areas within the same city/ province, county, state, country. They follow an RRP (Recommended Retail Price) or SRP (Suggested Retail Price) system.

In India however, for all Branded products, we have an MRP rule and we dont allow differential pricing on account of differential real estate costs or whatever - however, the same logic ideally ought to apply to Fuel as well, since Fuel is also a Branded Product - but unfortunately this dichotomy exists in the system.

I suppose if they de-control the pricing, all the refining companies can jump into the fray offering good deals and special promo pricing etc, special weekend pricing, highway/ suburban pricing etc the same way that the organized retail setups are doing across the country for other products. Competition, in this sense, will drive benefit to the consumers and the power shift will take place in favour of the consumer, where now it is in the hands of the seller/ retailer/ govt.

In the above scenario, perhaps companies like Reliance will come back into retailing fuel - as are Essar, Shell and Mangalore Refineries - (HI Q). Perhaps even Madras Refineries and Cochin Refineries could get into direct retail.

Consumers can then choose whether to drive that extra mile or two for buying cheaper fuel, or for reasons of convenience, simply pay the premium in price and fill up closer to their homes or their workplaces.

I am not sure what holds the govt back from allowing healthy competition in this manner.

Do share your views guys...

Perhaps! However, I believe all it would lead to is "looting" the customer. The petrol pump owners will charge what they want and people living in lets say cuff parade would pay a premium to what a Bandra guy would pay. Why?

[shankar.balan]

coolio - your fear is justifiable.
however, in that case, dont you think we should have an MRP based system first? Across all states??
Why should only the people of a few states like for example Karnataka be made to pay such a huge price for Fuel when compared with a Union Territory like Delhi/ Pondicherry??
Where's the logic in that?
Already we are being looted pretty badly in the form of various taxes and cess etc - in return for absolutely nothing!

Originally Posted by amtak

Perhaps! However, I believe all it would lead to is "looting" the customer. The petrol pump owners will charge what they want and people living in lets say cuff parade would pay a premium to what a Bandra guy would pay. Why?

[amtak]

Originally Posted by shankar.balan

coolio - your fear is justifiable.
however, in that case, dont you think we should have an MRP based system first? Across all states??
Why should only the people of a few states like for example Karnataka be made to pay such a huge price for Fuel when compared with a Union Territory like Delhi/ Pondicherry??
Where's the logic in that?
Already we are being looted pretty badly in the form of various taxes and cess etc - in return for absolutely nothing!

I agree with you. However, just think that when such a system is already in place, another system will just lead to utter chaos. I govt does not change or alter old rules. I am sure if its implemented, both the rules will stay and we would have to suffer. Its high time that govt reduce the taxes on fuel (some states have I guess)

[blue_pulsar]

I'm not sure whether this has been discussed, but the break-up of recent petrol price(Bangalore) is as follows:
Following details are for per liter petrol in Rs.
Basic Price = 22.93
Excise duty = 15.85
Education Tax = 00.63
Dealer commission = 03.25
VAT = 06.50
Crude Oil Custom duty = 01.60
Petrol Custom = 01.94
Transportation Charge = 06.00
————————————————————-
Total price = Rs 58.70/-
————————————————————–
source: Bear it, fuel price hike modest, minimum

[shajufx]

There is hardly any chance of seeing state intervention in the present prices after reading this report. "Chief Minister B.S. Yeddyurappa has ruled out slashing sales tax and entry tax on petroleum products in the state to cushion the impact of the steep hike, saying the state had not resorted to any fresh impost in the last budget, which he presented as finance minister in the previous coalition government." It also explains how bangalore has the highest price. Source Petrol, diesel costliest in Bangalore

[aaggoswami]

@shankar.balan:

Your views are positive with optimitic approach. But if the situationn had been so ( read de-control ) then in the first place, Shell, Reliance wont have walked out.

The basic reason, IMO, is that a lot of government is involvement is there and most of it is without reason. If de-control is done and if government decides that it will take, lets say Rs 5-7/ltr of diesel of petrol and rs 5-7/lpg cylinder, then government can earn equal amount of money through economies of scale. I am sure that even with this curde price, if government decides to go for that 5-7/ltr scheme, we will have happier days.

I'm not sure whether this has been discussed, but the break-up of recent petrol price(Bangalore) is as follows:
Following details are for per liter petrol in Rs.
Basic Price = 22.93
Excise duty = 15.85
Education Tax = 00.63
Dealer commission = 03.25
VAT = 06.50
Crude Oil Custom duty = 01.60
Petrol Custom = 01.94
Transportation Charge = 06.00
————————————————————-
Total price = Rs 58.70/-

Here is the proof, thanks to other user, that what is government is taking away!
15.85+0.63+3.25+6.50+1.60+1.94+6 = 35.77 Rs on the basic price of 22.93 .

So who wants to argue now that this move is justified.

And again what for the Transport cost ? Fuel in refinied in my city and I end up paying more than Delhi ?
Why this ? Any logic ? I am ready to pay 6 rs./ltr if there is uniformity in the prices of both petrol and diesel in India.

If my maths if not wrong then I think that if original cost is 22.93 and if this is considered as 100 %, then we are paying 155 % of the basic cost as TAX!

Speechless is understatement now.

[praveen_v]

Originally Posted by aaggoswami

If my maths if not wrong then I think that if original cost is 22.93 and if this is considered as 100 %, then we are paying 155 % of the basic cost as TAX!
Speechless is understatement now.

Hehehe.. And the govt dares to say that petrol/diesel are heavily subsidised. The govt puts the money in it's pockets and the oil companies are crying on losses. Wah Wah

[pgsagar]

[quote=lurker;855330]probably !

1. People should now move wholesale to CNG, because it can be sourced from Krishna/Godavari belt in India as well as from Gujarat. Also CNG can be converted from Biogas (Gobargas). An avg sized farm can produce enough CNG to fuel a car for an year.

2.Fuel price scam is the biggest scam of the 20-21st century. What should never cost above $40/barrel even at the worst of times is being sold at a whopping $130. It is daylight robbery being caused by big funds/speculators and profiteers mainly sitting in the London/NY/Belgium.




1. Right but wait till CNG cathes up and our greedy, revenue-hungry Govts. would not spare even that.

2. True. You can add GOI and State Govts. to the list of those LONDON / NY daylight robbers.

[LLL]

With different states reducing different amounts of sales tax, we now have different prices in every state. Should we have a thread that tracks the price of normal petrol/diesel per state?

it would be beneficial for people living in border areas, crossing states (like Del-Up-Har), or going on long distance drives. They can fill from cheapest pump.

[druva]

Originally Posted by aaggoswami

15.85+0.63+3.25+6.50+1.60+1.94+6 = 35.77 Rs on the basic price of 22.93 .

So who wants to argue now that this move is justified.

....

If my maths if not wrong then I think that if original cost is 22.93 and if this is considered as 100 %, then we are paying 155 % of the basic cost as TAX!

Speechless is understatement now.

Think about the discounted price for Kerosene and LPG. This is where it hurts the government most.. Once you include those two to your calculations, you will see the government figures going to negative. With our 'Economies of scale' it turns to be a rather large deficit.

[nawabnabeel]

the cost of fuel in Bombay is 2-3rs more than the cost of fuel in panvel which is in new bombay. this is because the bmc (municipal corporation) collects octroi on fuel.

[suman]

So Diesel is now cheapest in Gurgaon (cheaper than even Delhi). Regular diesel is now Rs 33.73 per litre.

[diabloo]

Bangalore is NOT the place where fuel price is highest.

Highest in Karnataka state are:
Petrol - Hassan: 58.98
Diesel - Bellary: 40.37
(This may be the highest in the country).

Bangalore price:
Petrol: 58.50
Diesel: 39.80
So folks in Bangalore can breath easy.

Lowest in Karnataka:
Petrol: 57.77
Diesel: 39.35
Both in Mangalore.

Originally Posted by benbsb29

Bangalore's taxing criteria never ceases to amaze me!
Highest in everything, from road taxes, cost of fuel... not to forget the rents, deposit amounts for rent (not tax related, but still), blah blah.. it just goes on.

[tsk1979]

If MRPL opens up a pump in BLR, you will see lower rates because then the import tax on Petrol and Diesel(which KA govt charges) will become nill.
Currently Petrol and Diesel are mostly imported from Chennai.

Meanwhile, crude hit almost 140$/barrel when Morgan Stanley(who obviously have lots of barrels in commodity market) predicted 150$/barrel by July 4.
This shows what controls the crude price. Its no longer Demand and Supply, but hedge funds and bankers.
When the bubble bursts its going to take down a lot of people.