India'spetrolpricesareinfluencedbyacombinationofinternationalcrudeoilprices,domestictaxstructures,andcurrencyexchangerates.Asofthelatestdata,thepriceofpetrolinIndiahasbeenobservedtobesignificantlyhigherthaninsomeofitsneighboringcountries.ThisdiscrepancycanbeattributedprimarilytothehighertaxesimposedonpetrolinIndia.
In2023,Indiaconsumedaround220MillionMetricTonnesofcrude-oilorpetrolproducts.PetrolratesinIndiaisoneofthesignificantfactorsthatdirectlyorindirectlyimpactahugelevelofpopulation,regardlessofthemnotacknowledgingthefact.India'sfuelconsumptionisonariseconsistentlyandinMay2023reachedanalltimehighasperreportsbytheendoftheyear.ThisfestiveseasoninIndia,passengervehiclesalessky-rocketedbreachingthemillionmarkanddespiteincreaseof85%intheusedcarsegment.
Asperthedata,morethan80%ofIndianshaveoptedforpetrolvehicles,whichindicatesthestrongdemandandconsumptionforthecountryahead.Maximumnumberofpurchasesweremadebyindividualsbelowoftheageof35,whichensuredthatalmostRs.4.7crorewasdisburseddailyduringtheyearforvehicleloansbyjustonemajorcarsellingplatforminIndia.TheincreasingfundingandconvenientoptionofEMIpaymentspredictasurgeinfuel-basedvehiclepurchasesdespiteavailabilityofEV.TheavailabilityofotheroptionshavefailedtoimpactpetrolconsumptionandpetrolpricesinIndiaholdafirmgrip.
ThecriticalnatureofpetrolforadevelopingeconomylikeIndiawouldholdontothehaveanupwardtrendforconsumptionaswellasimports.Iftheimportsforcrudeoilincreases,sowouldbetheend-userpetrolrateinIndia.However,majorinvestmentsaremadeforrefiningsectorandexploration,whichwouldstabiliseforinternalsupplyratherthanglobal.FollowingfactorsgenerallyimpactthepetrolpricesinIndia:
DomesticUsageofPetrol
Thetotalconsumptionforpetrolincreaseseveryyearwithincreasingvehiclesales,asabasiceconomicindication,thehigherthedemand,thecostwouldalsoincreaseaccordingtoit.Thescarcityandcontrolledavailabilityofpetrolwouldincreasethecost,fuelledwithinflationandotheraspects.Ifthereisadisruptioninsupply,petrolpricesareimpactedadversely,whileontheotherhandifsupplyincreasesbyinternalproduction,priceswouldbestable.
RevenueCollectionForGovernment
ThetaxcollectedthroughnumerousleviesandchargesimposedonbothbusinessesandconsumersinfuelsectoristhelargestsourceofincomeforIndiangovernmenttreasury.WhenthecentralministrydecidestoincreasetherevenuegenerationfrompetrolpricesinIndia,Thedomesticrateswithinthecountrywouldbealsoimpactedasperthosedecisions.
GovernmentRegulations
InIndia,governmenthavestronginterventioninfuelpricespertainingtotheessentialnatureoftheproductanditsvividvariationsusedincountlesssectors.Moreover,iftherulinggovernmentdecidesforanexpectationofhighervotesinthecomingelection,petrolpricesinIndiawouldbepulldowninfavouroftheconsumers.Incontrast,ifthecentralgovernmentdecidestogetmorerevenuefortreasuryearnings,aslighthikeinpetrolratesinIndiaisexpected.
GlobalAspects
Internationallypetrolholdssignificanceformanydevelopedanddevelopingeconomies,whichalsofluctuatesstronglyasperthegeopoliticalrelationsbetweentheimportingandexportingcountries.However,ifthereareanywarescalationsbetweencountriesthatfallinthetradingrouteofIndia,alsohaveadirectionalpushforpetrolpricesinIndia.Therecentwarin2023byRussiaincreasedthedemandforoilgloballyandthecountriesthatbarredRussianoilwitnessedhugespikeinrates.PetrolratesinIndiawereunaffectedsinceIndiangovernmentallowedtradingRussiancrudeoil.
Dailypetrolpricesrevisionisabetterpropositionforanumberofreasons.ThefirstandtheforemostisthatitallowsyoutoeasilyabsorbthechangesindailypetrolpricesinIndiabyafewpaise.Whenpetrolpricesarerevisedorchangedeveryfortnightthereisabigvariationinprices,whichputsgreatadditionalpressureontheconsumer.
InIndia,petrolpricesarerevisedbytheoilmarketingcompanieslikeIndianOil,BharatPetroleumandHindustanPetroleumbasedontheinternationalprices.So,wheninternationalcrudeoilpricesgain,petrolpricesinIndiamovehigherandsoon.Ontheotherhand,ifcrudeoilpricesintheinternationalmarketsdrop,weseeafallindailyortoday'spetrolpricesinIndia.Inanycase,weareprovidingourreaderswiththedailypetrolprices,sotheycanplantheirrequirementsoffillingpetrolaccordingly.
CostofCrudeOil–Thechangeinthepriceofcrudeoilintheinternationalmarketdirectlyinfluencesthepriceofcrudeoilinthedomesticmarket;thisisoneofthemostimportantfactorsresponsibleforanincreaseinpetrolpricesinIndiandomesticmarket.Increaseininternationaldemand,lowproductionrateandanypoliticalunrestinthecrudeoilproducingcountriesoftheworldseverelyaffectspetrolprice.
IncreasedDemand–EconomicgrowthinIndiaandotherdevelopingcountrieshasalsoledtotheincreaseindemandforthepetrolandotheressentialfuelsinIndia.ThenumberofpeoplewhoownprivatevehicleshasgoneupintherecentpastwhichhascontributedtotheincreaseindemandforpetrolinIndia;thishasresultedinthehikeinpetrolpricesinIndia.
MismatchofSupply&Demand–OilrefinerycompaniesinIndiafaceproblemtomeetthedemandsofthemarketduetothehighcostofinputpriceofcrudeoilthusresultinginlesssupplyandmoredemandforpetrolinthecountry.Anincreaseinsupplyresultsinadecreaseinthepriceofthepetrolandviceversa.Oilrefiningandmarketingcompaniesmaintaincrudeoilinventoryuptosixweeks,whichalsoinfluencesthepriceofthepetrolandpetroleumproducts.
TaxRates–Thepricesofpetrolandotherpetroleumproductsvariesaccordingtothelocalgovernmentpolicieswhichimposetaxesonfuels.AsandwhenthegovernmentofIndiaraisestaxratesonfuelstheoilcompaniesinIndiaalsoincreasesthepriceofthepetroltorecoverlossesandmaintainmarginalprofitsintheoilbusinessinIndia.
RupeetoDollarExchangeRate–Therupee-dollarexchangerateisalsooneofthemajorfactorswhichinfluencethepriceofpetrolinIndia.Indianoilcompaniespaytotheoilimportedfromothercountriesintermsofdollars,buttheirexpensesareregardingrupee.So,whenthepriceofthecrudeoilisinthefallbuttherupeeisalsoweakagainstthedollarthenitwillreducethegainstotheoilrefiners.Ontheotherhand,whentherupeestrengthensagainstthedollarandthepriceofthecrudeoilisinthefall,thentheoilcompaniestendtogain.
Logistics-Logisticsisoneofthesignificantfactorsinpricingretailfuel.Petrolanddieseltransportedtolongerdistancestocitiesorregionsfartherfromdepotswillbepricedhigherthantheplacesnearertotheoilcompaniesstoragearea.ThereasonbehindthechangeinthepricesofpetrolindifferentcitiesacrossIndia.Thisdifferencemaybehugebetweencitiesthatarefarfromeachother.Forexample,petrolpriceinDelhiisRs.72.38perliteronJanuary24,2018,andthesamepetrolpriceisRs.80.25perlitreinMumbai.
ThefearlinkedtotheriseofpetrolpricesinIndiaseemstobeneverending.DoweblamecrudeoilforthesesteeppriceshikesOr,istherootcausesomethingdifferentWell,theanswerliesinthefactthatwhilecrudeoilcontinuestoremaincheaper,itisthetaxesleviedbythestateandcentralgovernmentswhichareactuallyresponsiblefortheeverrisingpetrolrates.
Ifstudiesaretobefollowed,itwouldbequitesimpletoassociatethetaxfactortothesteephikeinpetrolprices.SinceMay2014,therehasbeenasuccessiveincreaseinexciseduties.DatarevealsthatasofNovember2014,therehasbeena54percentincreaseintheexcisedutyonpetrol.InspiteofthegovernmentslashingexcisedutyonpetrolaccordingtotheBudget2018,yetthereseemstobenodownwardcurvewhenthepriceofpetrolistakenintoconsideration.ThisisduetotheintroductionofRs.8perlitreasRoadCess.
Dailypricerevisionofpetrolhasbegunfrom16thJunethisyear.Ithasbeenobservedthatthepricerisehashappenedgradually.AspetroldoesnotfallunderGST,thepriceofitvariesacrossstates.However,whenconsideringthecost&freightpricesalongwiththeexciseduty,dealercommission,applicableVAT,etc,ithasbeenfoundthatthetaxesonpetrolsumsuptobemorethanitsactualcost.
Although,presentlycrudeoilhasbecomemuchcheapercomparedtowhatithadbeenwaybackin2014,itisthecollectivetaxesleviedbythestateandthecentralgovernmentthathascausedthepetrolpricestorisetowhatithadbeenin2014,thehighesttilldate.Despitepromisesfromthegovernmentregardingrollingbackthetaxes,weareyettoseesomepositiveeffortsonthisfront.
Petrolpricesareafunctionofmanythings.AmongtheseincludetheaverageoftheIndiacrudebasket,towhichisaddedahostoftaxesincludingvalueaddedtax,centralexciseetc.
Atthemoment,wehavetheexcisedutyleviedbythegovernment,whichisastaggeringRs21perlitre.Shouldthisbereducedwemightgetsomerespitefromveryhighretailleveloffuelanddiesel.
Thevalueaddedtax,differsfromstatetostate.IncitieslikeMumbaiandNewDelhithevalueaddedtaxisveryhigh,whichhasresultedinanextremelyhighpricesforbothpetrolanddiesel.
InIndia,retailpricesaredeterminedbytheoilmarketingcompanies,bearingallthesethingsinmind.So,theretailpriceofpetrolinIndiatodayisdeterminedbytheIndianOilMarketingCompany,whichisthelargestoilmarketingcompanyinthecountry.
Forexample,itreleasesthepriceofpetroleverydayat6am,whereinitisrevisedatthepetrolpumpsinthecountry.TheprivatesectorpetrolpumpslikeShellalsodeterminetheirownprices,thoughtheytendtobehigherthanthatofIndianOilCompany,BPCLandHPCL.
Thefuelisoneofthecostliest,whencomparedtoneighboringcountrieslikePakistan,BangladeshandSriLanka.Itmayberecalledthatpetrolanddieselpriceswereearliersubsidizedbythegovernment,but,thesamewerealignedtomarketprices.
However,thegovernmenthasovertheyearsaddedtoexcisedutyonpetrol,whichhasmadeithorriblyexpensiveforconsumers.
Theonereasonwhyexciseisaddedbeforepetrolisretailedatthefuelstationsistomop-upadditionalresourcesforsocialschemes.However,thisleavethecommonburdenedwithadditionalratesonthefuel.
Thegovernmentislookingatthepossibilityofreducingpetrolpricesoverthelongerterm,however,itwouldneedtofindmorelongertermmechanismstodoso.OneofthemistoaddsometaxesontoOilandNaturalGasCorporation,whichisanoilexplorationcompany.However,thesemaybealltemporarymeasuresandoneneedstofindamoredurablelong-termsolution.
YoucancheckpetrolpricesinIndia,inanumberofways.ThemostpopuarwayistosendanSMS.Forexample,ifyouareatanHPCLpumpyoucansendanSMSto:HPPRICEDEALERCODEandsenditto9222201122.
ForIndianOilCorporationorIOCsendSMSto:Type:RSPDEALERCODEandsenditto9224992249.
Youcanalsogoonlineandcheckanumberofwebsites,thatprovideyoudailyratesofthefuel.Remember,thatIndianOilthecountry'slargestretailerrevisesfuelpriceseverydayat6aminthemorning.So,youareabletochecklivepetrolpriceeverydayafterthistime.
Itisalsoimportanttonotethatbulkofthefuelissuppliedbythegovernmentownedoilrefiningcompanies,includingthelikesofIndianOil,BharatPetroleumandHPCL.ThereareotherprivateretailerslikeShell,whichalsoretailfuelataslightlyhigherprice.
Indiawhichmainlydependsonimportsforfuelsellsfuelsandlubricantsforvehiclesacrossthepetrolbunksorpetrolpumpswhicharespreadacrossthelengthandbreadthofthecountry.ThelargestoilandgascompanyinIndia–IndianOilCorporation(IOC),ownsmostofthefillingstationsanditisfollowedbyHindustanPetroleum(HP)andBharatPetroleum(BP).
TherearesixbrandsofpetrolpumpswhicharecurrentlyactiveinIndia.Theyare:
1.IndianOilCorporation
TheIndianOilCorporation(IOC)isoneofthebiggestoilcompanyinIndia.ItisownedbythegovernmentofIndiaandisvaluedasthemostprofitablecompanyinthecountry.IOCLmainlyoperatesmostofthepetroleummarketsharethroughitsfillingstations,ServoLubricantoils,naturalgas.Apartfromthis,italsoprovideselectricchargingstationsforelectricvehiclesatitsfillingstations.
2.BharatPetroleum
BharatPetroleumisthesecond-largestoilandgascompanyinIndiaandstandsnexttoIOCL.IthasitsrefinerieslocatedinKochiandMumbai.ThefuelfillingstationsofBharatPetroleumprovidesworld-classservicestoitscustomersacrossthecountry.
3.HindustanPetroleum
HindustanPetroleumorHPCLisoneofthemosttrustedbrandsoffuelfillingstationsinIndia.Thefirmoperatestwoofthemajorrefineriesinthecountryandproducesanarrayofpetroleumfuels.
4.Shell
Shell,whichisoperatedbyRoyalDutchShellcurrentlyhasover100fillingstationsinIndia.Knownforitssuperiorqualityoffuel,thecompanyhasplanstoexpandthenumberofpetrolfillingoutletsacrossmanycentresinthecountry.
5.ReliancePetroleum
OwnedbytheIndianconglomerate,RelianceIndustries,ReliancePetroleumisoneofthelargestprivatesectoroilfirmsinIndia.ItsJamnagarrefineryistoutedasoneofthelargestrefineriesinIndia.
6.EssarOil
EssarOilispartoftheEssarGroupwhichwasearlierknownasNayaraEnergy.Asofnowithasover1,400petrolpumpslocatedacrossIndiaandhasplansforexpandingitspresencebysettingupmorepumpsinthecountry.
Indiamainlydependsonimportswhenitcomestooilandgas.Thecountryimportscloseto82.8%ofcrudeoiland45.3%ofnaturalgastomeetthedomesticrequirements.Thecountry’snetforeignexchangeforthefiscalyear2017–2018stoodat$63.305billionduetoimportofcrudeoil.Thecountrygeneratedaround35.2milliontonsofpetrolanditsrelatedproductsfromindigenouscrudeoilproductionwhereastheconsumptionofpetroleumanditssubstituteproductsstoodat204.9milliontons.
Duetotheheavyimportoffuel,IndiaoccupiesthethirdpositionwhenitcomestoconsumptionofoilaftertheU.S.andChina.
InadequatereservesofpetroleuminthecountryhasforcedIndiatodependonimports.Thecountryisslowlyturningtouseitsrenewableresourcessuchaswind,solar,biomass,hydroelectricpowerandsoontoachieveenergysufficiencyincomingdaysasitplanstoreplacetheuseofpetroleumproductswhichcontributesgreatlytowardsairpollution.
Petrol,fuel,isaliquidcombinationderivedfromapetroleumsource.Theliquidmixtureconsistsofpredominantlyaliphatichydrocarbons.Thisliquidisenhancedbytheadditionofaromatichydrocarbonslikebenzeneandtoluene.Theadditionofaromatichydrocarbonswillincreasetheoctaneratings.
Theoctaneratingsrefertothemeasureofthefuel’sabilitytoresistknock,whichhappenswhenanengine’scylinderignitesprematurely.
Hencepetrolhasabasicchemicalformuladuetothepresenceofamixtureofseveralcompoundswhichareblendedaspertherequirements.
TheChemicalFormulaofPetrolisCnH2n+2.
Crudeoilorcrudeisoftenadark,stickyliquidwhichcannotbeusedasitiswithoutchangingit.Usually,crudeoilisamixtureofdifferentchemicalsknownashydrocarbons.Hence,thefirstandforemostpartofrefiningcrudeoilistheheatingprocess.Thecrudeoilwillbeheateduntilitboils.Theboilingliquidwillbeseparatedintodifferentliquidsandgasesindistillationcolumns.Afterthisprocess,theliquidswillbeusedtomakeparaffin,petrol,dieselfuelandsoon.
Theboilingprocesswillturntheoilintoamixtureofgasesinthecolumn.Thegasesflowupthecolumn–thehottestwillremainatthebottomandthecooleroneatthetop.Thesegaseswillcooldownastheygoupthecolumnuntiltheycondensetoturnbackintoliquidformagain.Now,theseparatedliquidsandgaseswillbecleanedandsubjectedtofurtherprocessing,tomakemanyothersub-products.
ThedemandforpetrolinruralIndiahasbeencontinuouslyrisingduetotheincreasinguseofpetrol-basedmachineryinvarioussectors.Thisisparticularlynoticeableinagriculture,wheretherehasbeenasignificanttransitionfrommanuallabortomechanizedoperations.Astherelianceonmachinerypoweredbypetrolhasbecomeanecessityforfarmerstooptimizeproductivity,thedemandforpetrolhasconsequentlysurged.
Withtheongoingeconomicdevelopmentinruralareas,theadoptionofmechanizedtechniqueshasbecomecrucialtoboostagriculturaloutputs.Theshifttowardspetrol-basedmachineryhasproventobemoreefficientandtime-saving,leadingtoincreasedagriculturalproductionandimprovedlivelihoodsforruralcommunities.However,thisshifthasalsoledtoahigherdemandforpetrol,astheusageofmachinerycontinuestoexpandanddiversifyinvarioussectors,contributingtotheoveralldevelopmentofruralIndia'seconomy.
AnotherfactorcontributingtotheincreaseddemandforpetrolinruralIndiaistheimprovedroadconnectivitythathasbeenwitnessedinrecenttimes.Theruralareashavewitnessedsubstantialgrowthintheirroadinfrastructure,whichhasledtoasignificantincreaseinthenumberofvehicles,includingbothtwo-wheelersandfour-wheelers.Sincethesevehiclespredominantlyrelyonpetrolastheirfuelsource,ithasconsequentlyledtoanotablesurgeintheconsumptionofpetrolintheseregions.
Theimprovedroadconnectivityhasresultedingreateraccessibilityandconnectivityfortheruralpopulation.Asaresult,morepeoplenowrelyonpersonalvehiclesfortransportation,leadingtoaproliferationofpetrol-poweredvehicles.ThisriseinmobilityhasnotonlyincreasedthedemandforpetrolbuthasalsoresultedinahigherconsumptionrateofthisfuelinruralIndia.Hence,thegrowthinroadinfrastructureplaysacrucialroleinthesurgingpetroldemandinruralareas.
Beingadevelopingeconomy,Indiaisthethirdlargestconsumerofcrudeoilgloballyandabout96%oftheconsumptionisimported.ThevolumeofpetrolproductsconsumedinIndiafor2023stoodat164millionmetrictonnes.Almostallthepetrolproducedandcirculatedinthecountryispouredinthetransportsectoralone.ThehighdependencyoffuelandcrudeoilforpetrolproductionmakesinternationalfuelpricesimpactthelocalpetrolpricesinIndiatoday.
OnaverageinIndia,thetwo-wheelersegmentcontributesmorethan60%inthetotaldemand,followedbycarsandthree-wheeler.SincethepetrolratesinIndiatodayarederegulated,asuddenhikeintherateswouldhaveseriousimplicationsfordisposableincomeofcommonmen.Stateswithexceedingnumberoftwo-wheelerthancarsgenerallyhavehigherconsumptionanddependingonthesefactors,Indiapetrolratesvaryfromasperthestateregulationandtaxescollected.
Thestrongconnectivityandinter-dependencyfortradesinthemodernworldtodayhaveleadtonumerousfactorshaveeitherapositiveornegativeimpactonpetrolpricesinIndiatoday.Asfarthebasiceconomicsisconcerned,wheneverthereisanincreaseindemandlocally,thepricesareevidenttogetimpactedasthesupplywouldremainthesameagainstit.Incontrastwhenthereisanincreaseinsupplyduetomultiplereasons,petrolratesinIndiatodaymightfallslightly.
SincetheconsumptionofpetroleumproductsishighinIndiaandthenecessityforthefuelhasdirectimplicationsonsavingsofthemiddleclasspopulation,thegovernmentintervenesmultipletimestoensurethereisstabilityinpetrolpricesinIndiatoday.Ifthegovernmententersinatradeagreementwithcrudeoilorpetrolexportingcountryforreducedcustomsandotherlevies,thenthereisafortunatedecreaseinIndiapetrolratestoday.
Ontheotherhand,iftherearegeopoliticaltensionsinglobalpowersorconflictsescalateincrudeoilexportingcountries,thentherearechancesofinternationaldemandtohikeamidstuncertaintiesandthecollectiveprocurementofcrudeoilcanuplifttheperbarrelpricesforit.Hence,thesechangesatgloballevelscanpushforpetrolratesinIndiatohaveamirroringeffectifthevolatilityinpricesishigh.
AnothersignificantaspectthatcaneitherhikeorpulldownIndiapetrolratestodayisgovernmentregulations.TherevenuegeneratedfromfueltaxcollectionisoneofthehighestinIndia,whichgetsimpactedfromthefuelratesacrossthecountry.IfthegovernmentofIndiafeelsthereisarequirementtoincreasethetreasuryrevenue,aslightincreaseincustomchargesandleviesoverpetroleumproductscanattractexponentialtaxcollection.Hence,ifrecentlythereisataxrateincreasesinfuel,ahikeisexpectedforpetrolratesinIndiatoday.
Whenfinancialmarketsaroundtheglobearelurkingaroundwithuncertainsentimentspostedbyeconomicturmoil,stagflationorrecession,investorswouldexittheirholdingsandflockoveralternativeinstrumentsfortheirinvestmentsincludingcrudeoil,commoditiesandsafe-havenmetals.Ifinvestorspredictthereisagrowthincrudeconsumptionahead,collectivebuyingpositionsofthetraderscanforcethepricesgloballytosky-rocket.UltimatelytheriseatinternationallevelscanfacilitateforlocalpetrolpricesinIndiatofollowthetrendaccordingly.
PetrolpriceswerereviseddailyinIndiawitheffectfromJune15,2017.Thiswasamarkeddeparturefromtheearlierpracticeofrevisingpetrolpriceseveryfortnight.
Forinstance,comparedtoIndia,petrolpricesincountrieslikePakistanandBangladesharelower.Thisispartlybecausethesecountrieshavedifferenttaxationpoliciesonpetroleumproducts.Incontrast,countrieslikeNepalandBhutanwitnesspetrolpricesthataresomewhatcomparableorevenhigherthaninIndia,duetotheirlandlockedgeographywhichaffectstransportationcostsandtheirdependenceonIndiaforpetroleumimports.
ThefollowingtableoutlinesthepetrolpricesinIndiaanditsneighboringcountries,offeringaclearcomparison:
CountryPetrolPrice(perlitre,inlocalcurrency)IndiaApprox.100-105INRPakistanApprox.150PKRBangladeshApprox.89BDTNepalApprox.110NPRBhutanApprox.65BTN
It'simportanttonotethatthepetrolpricesaresubjecttofluctuatebasedonglobaloilpricechanges,domesticpolicyadjustments,andcurrencyvaluationshifts.Thesefactorscollectivelymakepetrolpricingadynamiccomponentoftheregion'seconomies.
ThehigherpetrolpricesinIndianotonlyreflectthecountry'staxpolicybutalsohighlightthebroadereconomicchallengesofmanaginginflationandpromotingsustainablegrowth.Thegovernmenthasoftendefendedhighfueltaxesasanecessarymeasuretofinancepublicspendingwithoutexacerbatingfiscaldeficits.However,criticsarguethatthisplacesanundueburdenonconsumersandimpactsthecostoflivinganddoingbusinessinIndia.
Incontrast,neighboringcountrieswithlowerpetrolpricesfacetheirownsetofchallenges.Forexample,lowertaxrevenuesfrompetrolcanlimitgovernmentspendingonessentialservicesandinfrastructuredevelopment.Thus,eachcountry'sapproachtopetrolpricingrevealsabalancingactbetweengeneratingrevenue,controllinginflation,andensuringeconomicstability.
Ultimately,thevariationinpetrolpricesacrossIndiaanditsneighborsunderscoresthecomplexitiesofeconomicpolicy-makinginaregioncharacterizedbydiverseeconomiclandscapes.Asglobaloilpricescontinuetoexhibitvolatility,theimpactonregionalpetrolpricesand,byextension,ontheeconomiesandconsumersofthesecountrieswillbecloselywatchedbypolicymakersandanalystsalike.
PetrolpricesinIndiahaveseennotablefluctuationsovertheyears.Theratesareinfluencedbyglobalcrudeoilprices,currencyexchangerates,anddomestictaxes.Forconsumers,understandingthefactorsdrivingthesechangesiscrucial.
FactorsAffectingPetrolPrices
Oneoftheprimarydriversofpetrolpricesisthecostofcrudeoil.AsIndiaimportsmostofitsoil,internationalmarkettrendssignificantlyimpactlocalprices.Forinstance,whencrudeoilpricesriseglobally,Indianpricesfollowsuit.
Currencyexchangeratesalsoplayarole.Astrongerrupeecanoffsetrisinginternationaloilprices,whileaweakerrupeecanmakeimportsmoreexpensive.Thisdynamicdirectlyaffectsthecostatthepump.
Domestictaxesareanothersignificantfactor.Bothcentralandstategovernmentslevytaxesonpetrol,whichaddstothefinalretailprice.Changesintaxratescanleadtoimmediatepriceadjustments.
RecentTrendsandPredictions
Inrecentyears,petrolpriceshavebeenonanupwardtrajectory.Thisisduetoacombinationofrisingglobalcrudepricesandadepreciatingrupee.Analystspredictthatthesetrendsmaycontinueifcurrentglobaleconomicconditionspersist.
Expertsalsohighlightthepotentialforpolicychanges.Governmentinterventions,suchastaxadjustmentsorsubsidies,couldalterthepricelandscape.However,predictingthesechangesremainschallenging.
ImpactonConsumers
Risingpetrolpricesdirectlyimpactconsumers.Higherfuelcostsincreasetransportationexpenses,whichcanleadtoariseinthepricesofgoodsandservices.Understandingthesepotentialimpactscanhelpconsumersplantheirbudgetsbetter.
Conclusion
ThefutureofpetrolpricesinIndiahingesonmultiplefactors,includingglobaloiltrends,currencyfluctuations,anddomesticpolicies.Stayinginformedabouttheseelementswillhelpconsumersnavigatepricechangeseffectively.
ThepriceofpetrolinIndiaisinfluencedbyvariousfactors,withgovernmenttaxesanddutiesplayingasignificantrole.ThesetaxesincludeexcisedutyleviedbythecentralgovernmentandValueAddedTax(VAT)imposedbystategovernments.Together,theyformasubstantialportionoftheretailpriceofpetrol.
CentralGovernmentTaxes
Thecentralgovernmentimposesexcisedutyonpetrol.Thistaxisuniformacrossthecountryandcontributessignificantlytotherevenue.Asofnow,theexcisedutyonpetrolstandsatRs32.90perlitre.Thisamountisfixedanddoesnotvarywithchangesincrudeoilprices.
StateGovernmentTaxes
StategovernmentslevyVATonpetrol,whichvariesfromstatetostate.Forinstance,Maharashtracharges26%VATplusanadditionalRs10.12perlitreascess.Incontrast,DelhiimposesaVATof30%.Thesevariationsleadtodifferentretailpricesacrossstates.
ImpactonRetailPrices
ThecombinedeffectofcentralexcisedutyandstateVATresultsinhighretailpricesforpetrol.Forexample,ifthebasepriceofpetrolisRs40perlitre,addingRs32.90asexcisedutyandvaryingVATratescanpushthefinalpricetooverRs100perlitreinsomestates.
GlobalCrudeOilPrices
Whiletaxesplayamajorrole,globalcrudeoilpricesalsoimpactpetrolpricesinIndia.Whencrudeoilpricesrise,thebasepriceofpetrolincreases,leadingtohigherretailpricesevenbeforetaxesareadded.
GovernmentRevenue
Therevenuegeneratedfromthesetaxesiscrucialforbothcentralandstategovernments.Itfundsvariousdevelopmentprojectsandsocialwelfareschemes.However,hightaxesalsoburdenconsumers,leadingtocallsfortaxreductions.
RecentTrends
Inrecentyears,therehavebeenfluctuationsinpetrolpricesduetochangesinglobalcrudeoilpricesandadjustmentsintaxratesbygovernments.TheCOVID-19pandemicalsoaffecteddemandandsupplydynamics,influencingpricesfurther.
ConsumerImpact
Thehighcostofpetrolaffectsconsumersdirectlybyincreasingtransportationcosts.Italsohasanindirectimpactonthepricesofgoodsandservices,contributingtooverallinflation.
FutureOutlook
ThefutureofpetrolpricinginIndiawilldependonglobaloilmarkettrendsandgovernmentpoliciesregardingtaxation.Anychangesintheseareaswilldirectlyaffectretailprices.
WhatisthecurrentpetrolpriceinIndia
Today,thepetrolpriceinMumbai,India,is103.44perlitre.
WhichstateinIndiahasthelowestpetrolprice
Asofnow,Andaman&Nicobar(PortBlair)havethelowestpetrolpriceinIndiaat82.46perlitre.
WhichstateinIndiahasthehighestpetrolprice
Today,AndhraPradesh(Tirupati)hasthehighestpetrolpriceinIndiaat110.34perlitre.
Howmuchdoes1litreofpetrolcostinIndiatoday
OnNovember29,2024,thecostof1litreofpetrolinMumbai,India,is103.44.
PetrolRatesInIndiaTodayAremostlyconstantformostofthestates.ThepetrolpricesinMumbai,NewDelhi,KolkataremainedunchangedwhiletherateinChennaimovedalittle,increasingbyRs.0.23.Withahugedemandforcrudeoilthepricesarecurrentlymovinguphigher.
PetrolpricesinIndiahaveremainedlargelyunchangedthismonth,contrarytoinitialexpectationsofapricedecrease.Althoughcertaincitiesexperiencedminorpricefluctuations,theoveralltrendhasbeenoneofstability.Internationaloilmarketdynamicscontinuetoexertpressureondomesticfuelprices.WhileoilmarketingcompaniesadjusteddealermarginsfromOctober30th,thisisnotexpectedtohaveasubstantialimpactontheretailpricesofpetrolanddieselasperreports.
Crudeoilpricesclosedat$5,988whichsawa2.83%increase.Thissurgewasdrivenbystronger-than-anticipatedU.S.fuelconsumptionandreportssuggestingapotentialdelayinplannedoutputhikes.Additionally,U.S.gasolineinventoriesplummetedtoatwo-yearlow,witha2.7million-barreldeclineexceedingtheprojected0.6million-barrelincrease,asreportedbytheEnergyInformationAdministration(EIA).Brentcrudeiscurrentlytradinghigherat$75.24perbarrel,whilecrudeoilishigherat2.93%perbarrel.
ChennaipetrolpricestodaysitatRs.100.85/-perliter,showingaminimalincreasesinceyesterday.WhilethepetrolpricesinChennaihavefluctuatedslightlyoverthepasttendays,itisnowbacktothesamelevels.Globalcrudeoilpricescurrentlystandat$73.7perbarreldownby0.04%
Chennai,arapidlyexpandingcityinTamilNadu,isexperiencingasurgeinpopulationandconsequently,agrowingdemandfortransportation.Despitethisincreasedconsumption,petrolpricesinChennaihaveremainedrelativelystableoverthepastweek.However,giventhepreviouspricedropcoincidingwiththeIndianelections,ahikeinChennaipetrolpricesisexpectedinthenearfuture.
TheCommoditymarketsareseeingmixedperformanceinTuesday'ssession.TheUSdollarindexisdown0.08percentat101.80,whichisdrivingupthepriceofcrudeoilglobally.AdditionallythelatestdipinUSunemploymentclaimshascertainlyputabrakeonrecessionfears,butitisgoingtohaveanimpactoncrudeoilpricesinfuture.Also,thegeopoliticalturmoilintheMiddleEastishavingasignificantinfluenceoncrude,pushingthepriceshigher.
TheMCXCrudeoilFuturesmaturing19thSeptemberarecurrentlytradingatRs6,207/-perbarrel,whichis0.27%higherthanMonday'sclosing.
IndiapetrolratestodayremainintheaveragebetweenRs.94.25/-toRs.107.5/-perlitreamongstvariouscities.PetrolpricesforKolkatastaysatRs.104.95/-perliter,whileChennaiPetrolratestodayarearoundRs.100.75/-perliter.Similarly,BangalorepetrolpricestodayareatparwithaveragepricesofRs.102.86/-perlitre,andpetrolratesinJaipurtodayarearoundRs.104.88/-perlitre.PetrolpricesinIndiatodayplayakeyroleforthecentralbankindeterminingandmaintainingatightgriponinflationinthecountry.
Indiaisthelargesttwo-wheelermarketintheworld,whichhasnationalandinternationalclientsservingthedailycommuteneedsofaveragemiddle-incomeIndians.SincePetrolconsumptionishighlytowardsmotorcyclesinthecountryandIndia’ssluggishmovetowardselectronicvehicles,mightposeathreattopetrolpricesinIndiatoday.However,iftheglobaldemandforcrudeoilsurgesexponentiallyamidsttheMiddleEasternwar,thenfuelpricesinIndiamightjumpaswell.
Themixed10-yeartreasurybondsofmajoreconomiesandtherecoveredUSdollarindexsuggestanegativepricemovementforenergysegmentsahead.OiltradersaroundtheglobewouldexpecttheUSeconomicindicatorsscheduledthisweektomovecapitalandcurrencymarkets,ultimatelyinfluencingtheno-financialcommoditysegments.However,investorswouldalsowatchthegeopoliticaltensionsinGulfcountriestohaveamajorpushoncrudeoildemand.
TheMCXCrudeOilFuturesmaturingnextweekonMondayaretodayfloatingatRs6,478/-,afallof0.14%orRs9/-sinceyesterday’sclosing.
IndiapetrolratestodayareatRs.94.72/-perlitreinDelhi,whileMumbaipetrolratesareRs.103.4/-perlitre.ThepetrolrateinBangaloreisRs.102.86/-andinKolkataPetrolpriceisRs.104.95/-.TodaypetrolratesinIndiaarestablewiththehelpofthecentralgovernmentthroughstabletaxationinrecenttimes.
Indiaisoneofthelargestpassengervehiclemarketsintheworldcurrently.Consideringtheriseinnationalincomeandgrowthinthestandardoflivingofthepeople,Indiaisexpectedtohaveasignificantdemandforvehiclesaswellasfuelaheadovertheyears.However,withtheriseinelectronicvehiclesandalternativefuelconsumptionfortransportahead,India'spetrolpricesmightdiveloweriftheglobaldemandsupportsafortunatefall.
Internationallythecommoditysegmentshavecontinuedthefallsincelastweek,fallingconsistentlyamidstfavorablecapitalmarkets.TherecoverynotedintheUSdollarindexandpositivebondyieldsofmajoreconomiesmightpushforfurtherfallincrudeoildemand.InvestorswouldcloselywatchoverUSeconomicindicatorstohaveamajorinfluenceonoilandenergypricesahead.
InternationalCrudeOilpricesaretodaytradingat$78.5/-perbarrel,falling0.12%sinceFridayandUSBrentcosting$82.4/-perbarrel,afallof0.16%.
ThepetrolpriceinKarnatakaisatRs.102.86,whichhasincreasedbyRs.0.2.ThepetrolrateinKarnatakahasincreasedverylittlesinceyesterday.Althoughinthespanof10days,thepetrolratesinKarnatakahaveseenmarketfluctuationsandthepricerangehashoveredaroundRs.99.84toRs.102.86.
ThisfluctuationinthepetrolpricesinKarnatakacomesasthegovernmenthashikedthesalestaxratesonpetrolanddiesel.Thesalestaxonboththepetrolandthedieselhashikedby3.92%and4.1%respectivelywhichhasmadethefuelcostlierbyaroundRs.3.SourceswithintheCommercialTaxDepartmentindicatedthattheanticipatedpriceincreaseisexpectedtogenerateanadditionalannualrevenueofatleast500crore.
Duringthefiscalyear2023-2024,Karnatakarecordedconsumptionofapproximately53.43lakhkilolitersofpetroland1.19crorekilolitersofdiesel.Presently,thestateaccumulatesaround20,000croreannuallythroughsalestaxonpetrolanddiesel.
Whereas,theinternationalgasolineratesinMayhavealsoseenasignificantchangeofaround0.5%to2%whichindicatestheglobalmarkettrendforthefuels.
TodayIndiaPetrolratehavebeenfortunatelydecreasedbyRs.2/-perlitre.IndiaPetrolratestodayhavefallenthelowestintheNCR.DelhipetrolpricetodayisatRs.94.72/-,andKolkatapetrolratetodayfallstoRs.103.94/-perlitrerespectively.Ontheotherhand.PetrolpriceinMumbaitodayhavefallentoRs.104.21/-perlitrewhiletoday'sChennaipetrolrateisatRs.101.18/-perlitre.
Aspertherecentnewsreports,PrimeministerNarendraModihavepushedfordecreasingfuelcostinIndiaonlyafewdaysbeforetheelectionseason.Theglobalenergymarketremainsinturmoilcurrently,whiletheIndiangovernmentdecidestoslashfuelpricesbyRs.2/-perlitre.However,itiswell-knownbythegeneralpopulationthatthemoveismadetoattractvotersaheadofthegeneralelectionsscheduledthisyear.IndianscanexpectthesamepricerangeorbelowatleasttillMayorJune,beforeittakesareversalforexpectedexponentialhikes.
Internationallythecrudeoilhavesharplyriseninpastthreedays,climbingfrom$3.6/-or4.7%.Thedollar-backedcommoditymarketsaremovinginamixedmannertoday,despiteunfavorablecapitalmarketsand10-yeartreasurybondsingreen.USdollarindexhavesurgedsignificantlysinceyesterday'ssession,climbingby0.5%andposingathreatforcrudeoiltradesahead.However,oilinvestorsgloballywouldholdtheirattentiontowardsnextweek'sFOMCminutestohaveadirectionalpushoncrudeoildemand.
TheMCXCrudeOilFuturesmaturingnextmonthonFridayaretradingaroundRs6,719/-,afallof0.34%orRs23/-sinceyesterday'sclosing.
TodaythepetrolratesinIndiaperlitreisvariedfordifferentcities,dependingthelocaldemand-supplyscenariodomestically.DelhipetrolratestodayareRs.96.72/-,whilepetrolpricesinKolkatahaveremainedstableatRs.106.03/-.MumbaipetrolpricesarecurrentlyatRs.106.31/-,andpetrolratesinChennaitodayareRs.102.74/perlitre.Themajorcitiesofthecountrywouldfacehigherpricesduetotheexponentialdemandinurbanareas.
Beingadevelopingcountry,Indiaimportsahugeamountofcrudeoilfrominternationalmarketstosustainthedomesticneed.Thedependencyonglobalprices,makeIndiapetrolrateshighlyinfluentialwithanymajororminordisruptioninsupplychain.However,apushbytheIndiangovernmentstowardsEVwouldleadfuelconsumptiontofallatdomesticlevels.
InternationallythecommoditymarketsegmentaremovinginpositivenotesonTuesday'sAsiansession,supportedbytheplungingUSdollarindexandbondsyieldsofmajoreconomies.Apartfromtheunchangedinterestrates,theUSGDPgrowthratethisweekwouldhaveadirectionalpushforinternationalcrudedemand,ultimatelyhavingaslightimpactonlocalIndiapetrolprices.
TheMCXCrudeOilFuturesonTuesdayarefloatingaroundRs166.8/-,whichis0.54%orRs0.9/-lowerthanpreviousday'sclosing.
27February2024PetrolPricesInDelhiTodayOn27thFebruary2024SeesNoChangeDelhigoldratestodayarestayingthesameaspreviousdayatRs.96.72/-perlire.Thepriceshavestayedstagnantfordomesticresidentsduetothegovernmentregulations.Amongstthemajorcities,DelhipetrolpricestodayaresomeRs.9toRs.10lowerthantheaveragepetrolpricesinIndiacurrently.
ThelargestcityofIndia,Delhihasimmensepresenceofcommercialandeconomicactivitiesintheregion.Highconsumptionespeciallybythemiddle-incomegroupsinthecapitalcity,pushesforconsistentdemandforrefinedfuelahead.Delhigoldratesarestablecurrently,pertainingtothegovernmentinterventionandIndia'sretailcrudeoilpolicies
Internationallythecommoditysegmentsalongwithsafe-havenmetalsaremovingwithoptimisticapproachasuncertainsentimentslurkaroundcapitalmarkets.Naturalgaspricestodayarestableclimbingabovetheprevioussupportlevelsontechnicalcharts,whichindicateslocalIndiagoldratestobestableahead.Investorswouldaligntheirfocusovertomorrow'sUSquarterlyGDPdatatopushthecrudeoildemandthisweek.
TheUSSpotGoldratesonTuesdayaretradingaround$77.45/-perbarrelwhileBrentcrudepricesareat$82.34/-perbarrelonTuesdaytoday.
ThepetrolpricesarebalancedinDelhidespitewitnessingahikeinthecruderatesinternationally.TodayDelhipetrolrateisRs.96.72/-,whichiscomparablylowerthanothermajorcitiesofthecountry.
ThedemandforDelhipetrolisstrongaheadduetothepresenceoflargeworkingandbusinessclasspopulation,whichhighlyprefertwo-wheelersforcommutingofficelocations.DelhiisamongthehighestvehicleowningcitiesofIndia,whichwouldpushforpetrolratetodayinDelhitoberegulatedbygovernmentforthepublicconsumption.PricesareexpectedtoremaincalmaheadconsideringthearrivalofIndia'sgeneralelectionsthisyear.
GlobaldemandforcrudeoilhasjumpedstronglythisweekastheRedSeacrisishasaffectedtwoUSandoneUKcargoship,resultinginoilsupplydisruptioninmostpartsofEurope.TheUSdollarindexhasalsotumbled,supportingfundinflowstowardscommoditysegmentsandsafe-havenmetalstoday.Oilinvestorswouldholdtheirfreshimpetusforthisweek'sFOMCminutestohaveadirectionalforcetowardsBrentcrudepricesinternationally.
TheWTIcrudeindexintoday'sAsiansessionistradingaround$77.10/-perbarrel,ahikeof0.08%or$0.6/-sinceyesterday'sclosing.
21February2024IndiaPetrolRateTodayRemainsUnchangedDespiteGlobalUncertaintyInCrudeOilMarketTodaypetrolpricesinIndiahavestayedthesameaspreviousday.DelhipetrolpricestodayareatRs.96.72/-perlitre,whilepetrolrateinKolkatais106.03/-foronelitre,adifferenceofalmostRs.10/-fromtheNCR.MumbaiPetrolpricetodayisatRs.106.3/-andPetrolrateinChennaitodayisRs.102.74/-perlitrerespectively.
InternationallythecommoditymarketsarefavoredwithstrongfundinflowswitnessedinNaturalGassegment,ariseofmorethan7%sinceyesterday.WTI,themajorOilindextodayistradingaround$76.48/-perbarrel,afallof$0.6/-or0.8%.Similarly,thebenchmarkBrentcrudeisvisiblytradingat$81.74/-perbarrel,tumbling$0.58/-or0.54%sinceTuesday'sclosing.
ThedemandforcrudeoilhasincreasedrapidlythisweekastheRedSeacrisishavepushedforuncertainsupplydisruptionforlargerpartofEuropeanmarkets.GlobalpowerarmingagainstIranandHouthiRebelswouldescalateunstabilityforinternationaloildemand.Theuncertainsituationhaveleadtoinvestorsflockawayfromcapitalmarkets.However,theUSFOMCminutesscheduledthisweekisexpectedforunchangedinterestrates,posingathreatforcommoditymarketsegment.
TheMCXCrudeOilFuturesInIndiaarecurrentlytradingaroundRs144/-perbarrel,afallof18.09%orRs31.8/-sinceTuesday'sclosing.
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