[sgiitk]

Now Brent is again at sub $98 levels and rupee below Rs.61 to Dollar. So is there peace in the world!!

[suresh_gs]

Originally Posted by sgiitk

Now Brent is again at sub $98 levels and rupee below Rs.61 to Dollar. So is there peace in the world!!

Does this mean can we expect further cut in petrol price?. That would be icing on the cake.

[sgiitk]

Originally Posted by suresh_gs

Does this mean can we expect further cut in petrol price?. That would be icing on the cake.

Only the OMCs and God (I am not sure of the latter) knows! They were talking of a 55p hike a week back.

[rajshenoy]

Was reading this article : Speaks about the mood petrol cars now outselling diesel ones.
Pity on Suzuki developing in house diesel engine, Tata nano Diesel RIP, and FIAT, your bread and butter will be in trouble

http://economictimes.indiatimes.com/...w/43119885.cms

[sgiitk]

I think it is more a matter of re-optimizing production schedules are again jacking up the supply line for petrol components. I do not think the overall volumes will be impacted that much.

[lurker]

Originally Posted by suresh_gs

Does this mean can we expect further cut in petrol price?. That would be icing on the cake.

Yes, you can continue to expect. Indian fuel market is now decontrolled.

[sandeep108]

A 12-15% fall in brent crude prices, but OMCs still talking of 50p hike in petrol prices! At the minimum price drop should be 10%, i.e. at least Rs. 8/- from price of Rs. 80/- when brent price was high. So petrol price (in Mumbai) should be Rs. 72 currently instead of Rs. 76.50. Anybody from CCI listening? OMCs using their monopoly power to fleece the customers.

[adimicra]

This is unacceptable...looting public in the open.
Not only the OMCs are making more money, the Govt. is also filling up his coffers as the taxes are calculated as percentage.
I feel this govt is equally bad in terms of governance and transparency as the previous one. We need some big private players to really cleanup this sector. Shell has been a huge disappointment.
Surprisingly, there is not even a single protest anywhere about this irrational pricing of what is claimed as decontrolled commodity.

[Mohan Mathew A]

Originally Posted by sandeep108

A 12-15% fall in brent crude prices, but OMCs still talking of 50p hike in petrol prices! At the minimum price drop should be 10%, i.e. at least Rs. 8/- from price of Rs. 80/- when brent price was high. So petrol price (in Mumbai) should be Rs. 72 currently instead of Rs. 76.50. Anybody from CCI listening? OMCs using their monopoly power to fleece the customers.

Absolutely.

Brent crude was priced at around USD 113 in end of June. Petrol price in Mumbai was increased to INR 81.75 on 1st of July.
Currently Brent crude is trading around USD 97.5, i.e. a drop of USD 15.5 or a drop of 13.7%.

In the same period Rupee depreciated from 60 to 60.78 (rupee had dropped below 60 and gone above 61 in the period but for calculation i am comparing directly July 1st exchange rate with current)

If you factor in the depreciation of Rupee, Brent crude has dropped 12.6% in rupee terms.

So if petrol was to fall by the same 12.6% it should be priced INR 71.75 in mumbai.

When there is such a cushion isn't it really strange that all OMCs are pricing it at more or less the same price. If this is not cartelisation, then i don't know what is. Fit case for CCI to investigate i would say

Source- http://www.investing.com/commodities...istorical-data
http://www.mypetrolprice.com/3/Petrol-price-in-Mumbai
http://www.oanda.com/currency/converter/

[StarScream]

Originally Posted by sandeep108

A 12-15% fall in brent crude prices, but OMCs still talking of 50p hike in petrol prices! At the minimum price drop should be 10%, i.e. at least Rs. 8/- from price of Rs. 80/- when brent price was high. So petrol price (in Mumbai) should be Rs. 72 currently instead of Rs. 76.50. Anybody from CCI listening? OMCs using their monopoly power to fleece the customers.

Not making any excuses but that's because prices are set using a 15-day window. It is not immediate, like in the U.S. where you could be standing at a pump and the price changes mid way through refueling. In India prices are determined on a 15-day average, so crude or the rupee having turned favorable in the last few days means little for immediate retail prices. Everything remaining constant, it will make a difference 15 days hence. That also explains why you could have a counter-intuitive move of prices being raised when crude is falling.

[sandeep108]

While I had just done rule of thumb calculation, thanks Mohan for putting up authoritative numbers. Unfortunately even if the CCI investigates, all that they can do is fine the OMCs. That is of no use, it is just money again going from one pocket to another one in the same tattered pants! How will the customers or aggrieved persons benefit in any way?

The same problems can be seen in many other laws and acts, whether SEBI, Companies Act, PMLA, CCI, etc. and also now the new MV Act. They can keep fining / imposing penalties, seize assets, etc. but where does this all go? To the government!!! Nothing to the aggrieved consumers / investors / public / victims.

@starscream: But when brent crude prices rise, the OMCs are extremely immediate when it comes to increasing petrol prices, aren't they? Then why not the same when crude prices fall?

[ghodlur]

Is it the "who's going to bell the cat" situation? Can we collectively write to the concerned authorities asking justification for no price drop? Are there any correct contact details available? Maybe even the OMC's are waiting for someone to make noise, so that they can bring to effect the drop? The OMC unassumingly might want to sit on a neat profit unless someone points it out to them sarkaari style

[khoj]

Maybe the price revision is held up on account of the "EC's prescribed Code of Conduct" coming in to effect @ MH & HR elections.

Flip scenario in case the CoC is yet to come in to effect could be that the govt. will announce the reductions at the last possible moment to derive maximum benefit @ the polls.

[StarScream]

Originally Posted by sandeep108

@starscream: But when brent crude prices rise, the OMCs are extremely immediate when it comes to increasing petrol prices, aren't they? Then why not the same when crude prices fall?

Sandeep, it does happen like that. Say very soon after a price revision, a major geopolitical event takes place that sends oil spiraling, the increase in India will not happen out of turn. It'll happen at the end of the 15-day cycle - in that sense the Indian consumer is sheltered from higher prices for 15-odd days. It's just that because most people confuse current crude prices with Indian retail prices, an impression is created that the OMCs are quick to increase and slow to decrease. Decontrol in India is a 15-day cycle! I believe that they should completely free fuel and let the companies decide on prices in real time. It is more transparent and will allow more efficient players to offer better prices.

[lurker]

Originally Posted by ghodlur

Is it the "who's going to bell the cat" situation? Can we collectively write to the concerned authorities asking justification for no price drop? Are there any correct contact details available? Maybe even the OMC's are waiting for someone to make noise, so that they can bring to effect the drop? The OMC unassumingly might want to sit on a neat profit unless someone points it out to them sarkaari style

When going for total decontrol, why make the excuse for 2 weekly revision ? That itself is an opening for cheating public. Everybody and his dog knows that in 2 weeks oil prices will surely fluctuate. Surely it is a medium to fleece customers and benefit from cartelisation and monopolisation and I am sure the said govt of the day is in cahoots with these robber-barons because they get some kind of deficit-financing or some other shenanigans going from this fraudulent scheme.

Full decontrol should mean oil prices change everyday or once in 2 days. Full decontrol with fortnightly pricing is a sham that can be thought up only by some crooked Indian bureaucrat.

Decontrol in India is a 15-day cycle!

that is why it is a scam !