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Petrol costlier by Rs 3.14 to Rs 3.32 a litre from September 15, 2011
Oil companies on Thursday increased petrol prices by Rs 3.14 to Rs 3.32
a litre with effect from midnight, the second biggest hike in more than
a year. The hike, companies say, has been done to pass on the impact of
a depreciating rupee which has resulted in a higher import cost. The
last hike was effected on May 15, when companies raised prices by Rs 5 a litre as they losing Rs 10 a litre.
The increase comes after inflation climbed to a 13-month high of 9.78
per cent in August. This is the ninth increase since petrol prices were
decontrolled in June 2010. Petrol prices have moved up more than 39 per
cent since then. During the same period, diesel prices, which are still
regulated, have been increased just twice, by 8.37 per cent.
Even though petrol is decontrolled, public sector OMCs, Indian Oil,
Hindustan Petroleum and Bharat Petroleum, did not pass on the increase
in tune with market changes. Even though they claimed to be free toprice petrol, the increase was often staggered and guided by the
political environment.
Meanwhile, OMCs have also raised prices of aviation turbine fuel by 2.53
per cent, or Rs 1,429 per kilolitre, to Rs 57,689 in Delhi, with effect
from tomorrow. The increase has been on account of a sharp depreciation
in rupee against the dollar and firm global prices.
Oil companies, Government and Aam Aadmi
LPG, diesel price hike
on June 2011
On Friday, the 24th June 2011 evening the government announced another major increase in
fuel prices. No section of society was spared the burden as diesel rates
were increased by Rs 3 to Rs 47.25 per litre, LPG by a phenomenal Rs 50
per cylinder to approximately Rs 399 and kerosene by Rs 2 per
litre. On May 15, the government had increased petrol prices by Rs 5 per litre.
The man in the street will be forced to contribute Rs 21,000 crore to
the state coffers by this one swift stroke. Confounded by the repeated
burden the 'aam aadmi' is being saddled with, transporters' unions,
consumers and housewives alike despaired at the situation. Diesel being
a transporter's fuel, the cost of each item of consumption , be it
perishables or nonperishable , is set to spiral.
Several buses in the BEST and MSRTC fleets ply on diesel and the
management will soon take a decision on fare hike. Hotels and restaurants are also expected to revise rates.
Most vegetables already cost Rs 60 per kg in the absence of any trigger.
Pravin Wagh, president of the Crawford Market Fruitsellers Association ,
described the hike in diesel as a body blow to the common man. "It is
tough to imagine why the government is taking unpopular steps to benefit
public sector companies at the cost of the common man even as its own
ministers are involved in multiple scams," he said.
The Rs 50 rise in LPG prices has caused anger among housewives. "This is
open loot," said Bandra resident Sheela Damani. "Fruits have gone off
the table and it is becoming difficult to buy vegetables for a reasonable price.
I shudder to think what will happen with three years to go before the next election."
Bombay Goods Transport Association president Girish Agarwal said increase in diesel prices will add to inflation. "Freight rates and cost
of transportation will go up, inflating the cost of all essential
commodities," he stated. "When global crude oil price was US$ 140, the
diesel price was about Rs 35 . Now, when crude oil prices have dropped
in the range of US$ 100-110 , diesel has gone over Rs 42. We need to
review the entire pricing system." |
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Petrol in India costlier than in US
NEW DELHI, December 1, 2011: Petrol in India is costlier than in its neighbouring
countries and in the US, primarily because of high taxes. Petrol in Delhi today costs Rs 66.42 per litre as against Rs 44.88 a
litre price in the US, Minister of State for Petroleum and Natural Gas R
P N Singh told Rajya Sabha in a written reply to a question. Even after the November 16 reduction of Rs 2.22 per litre in rates,
petrol at Rs 66.42 a litre in Delhi is costlier than Rs 48.64 a litre in
Pakistan.
Whereas in Sri Lanka it is Rs 61.38 per litre, Rs 52.42 a litre in
Bangladesh and Rs 65.26 per litre in landlocked Nepal. Incidentally,
Nepal does not have a refinery and imports all its requirement from
India. However, petrol in Europe is costlier than in India. In the UK,
it is priced at Rs 104.60 per litre.
Singh said of the Rs 66.42 per litre price of petrol in Delhi includes
Rs 26.59 a litre because of taxes (both central excise and local sales
tax or VAT).The US has only Rs 5.32 per litre tax on petrol while it is Rs 62.47 a
litre in UK.
PETROL PRICES IN
METROS (in Rs per litre)
Delhi
Kolkata Mumbai Chennai
15-May-11 63.37
67.71 68.33 67.22
2-Mar 58.37
62.5
63.08 61.93
16-Jan 58.37
62.5 63.08 63.36
16-Dec-10 55.87
59.9 60.46 60.65
26-Jun 51.43
55.32 55.88 55.92
1-Apr 47.93
51.67 52.2 52.13
Petrol price was officially decontrolled on June 26, 2010 under Petroleum Minister Murli
Deora. The increase was then Rs 3.50 a litre. Since then prices have been hiked seven times, except in Mumbai where it marginally came down once. Despite decontrol and international prices rising, oil companies did not
raise prices since January 2011. Last such hike was in December 2008 when petrol cost Rs 50.56 a litre.
Bharat Petroleum (BPCL) on Saturday hiked price by Rs 4.99 a litre and
Hindustan Petroleum (HPCL) by Rs 5.01. Petrol at BPCL outlets currently
costs Rs 58.39 a litre and at HPCL pumps, Rs 8.38 a litre. The oil marketing companies said Saturday?s increase was only 50 per
cent of the required increase. "The full price hike has not been passed on to consumers. We were
incurring a loss of Rs 10.50 on a litre of petrol," said a senior
executive of Hindustan Petroleum Corporation who did not want to be named.
Government-controlled Indian Oil Corporation, Bharat Petroleum
Corporation and HPCL together were making a revenue loss of Rs 47 crore
a day on selling petrol. The revenue loss on petrol that includes a portion of marketing margins
now stands reduced by half. "Despite very high global crude oil prices and a huge debt burden of oil
companies, the increase is only moderate keeping the consumers? interest
in view,? said an IndianOil statement. After the petrol price increase, the next increase could come in diesel
which is being sold Rs 16.17 lower than the benchmark price and LPG. Oil
marketing companies are selling kerosene at a loss of Rs 29.69 a litre and 14.2-kg LPG cylinder at Rs 329.73.
Increase in fuel prices could further push up inflation, which is ruling
at 8.98 per cent, since diesel has a weightage of 4.6702 per cent in the
wholesale price index though petrol has a weight of 1.09015 per cent.
Fuel price index was 12.25 per cent for the year to April 30, 2011.
Union Finance Minister Pranab Mukherjee has already indicated that the
country's GDP growth could be lower than the targeted 9 per cent by a
percentage point due to inflationary pressure coming from oil prices.
Pranab Mukherjee
The government had not been taking a call on fuel price increase since
December despite the benchmark Indian basket of crude oil prices touching a peak of $121.90 a barrel on April 28 this year after it averaged $85 in 2010-11.The June 2010 hike in diesel, kerosene and LPG prices was done at $75 a barrel.
In the current financial year so far, the oil marketing companies have
incurred a revenue loss of Rs 22,000 crore on sale of diesel, kerosene
and LPG, prices for which are still controlled by the government. Though
upstream oil and gas producing companies are expected to share
one-third of this loss, called under recovery in industry parlance, a
meeting of the empowered group of ministers is expected to take up the issue of hike in these products next week.
` A date for EGoM has not yet been fixed.OMCs are able to show profits on their books because of being
compensated by the upstream companies Oil and Natural Gas Corporation,
Oil India and GAIL Ltd, besides the government. The three upstream companies are asked to share one-third of their
losses since a spike in global prices help them. They are paid
international parity price for their crude oil and other products sold
to the marketing companies. On the strength of Rs 20,000 crore released
earlier this week, the three oil marketing companies are expected to
show a profit in their 2010-11 results. The release of the amount has already wiped out the petroleum subsidy
provided for in the current year's budget. |
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