Petrol prices used to be stable in India whatever the prevailing international prices thanks to the Govt. oil companies absorbing any difference by the way of a subsidy. But from June 2010 the govt. ordered it's companies to reflect international prices to cut losses as the companies were not able to sustain themselves with all the accumlated losses. Since then prices have been fixed almost every two weeks and have only reflected international prices making consumers very unhappy.
Here's the breakup of petrol price per liter in Delhi. Read below the table for a lot of explanation regarding petrol pricing in India.
Source: IOCL Website.
* VAT as per Delhi. It varies from 33 % to 15 % from State to State
** Petrol Price is decontrolled with effect from 26th June, 2010. The price break up is as per IOC.
In the table above is the price a refinery pays at prevailing international rates to procure a liter of crude oil inclusive of shipping and other charges. This is calculated per Oil barrel (bbl) which equals about 159 liters of oil. Current market price is US $109. As you can see both the international crude price and the rupee value against the dollar affects the domestic price at which refineries acquire crude everyday which would reflect in your cost of petrol at road side.
From crude to petrol
* VAT as per Delhi. It varies from 33 % to 15 % from State to State
** Petrol Price is decontrolled with effect from 26th June, 2010. The price break up is as per IOC.
In the table above is the price a refinery pays at prevailing international rates to procure a liter of crude oil inclusive of shipping and other charges. This is calculated per Oil barrel (bbl) which equals about 159 liters of oil. Current market price is US $109. As you can see both the international crude price and the rupee value against the dollar affects the domestic price at which refineries acquire crude everyday which would reflect in your cost of petrol at road side.
From crude to petrol
- The crude oil from overseas suppliers is transported to refineries in India
- There are over 20 refineries across the country to which the crude is transported
- Crude oil is pumped into distillation towers, which separate the crude into various petroleum products like diesel, petrol, jet fuel, coal tar, etc
- Besides the cost of distilling and refining, other costs at this point include crude custom levy and freight from ports to the refinery.
- From the refinery the Oil Marketing Companies (OMCs) like IOC, BPCL, HP etc., buy refinied crude oil. The refining process (cost of refining crude is around Rs.6/ltr) and transportation costs are added to OMC bills and comes to about Rs. 44.12 (C) with a margin to the refining companies. But the price charged to dealers is about 47.91 as of 16/11/13, with a profit margin of more than Rs.3 to the Oil Marketing Companies. This margin fluctuates according to govt. policy but not more than 10%. The oil marketing companies may also make a loss on other petroleum products like Kerosine and Diesel on which the govt. grants subsidies which means they may sell these products to dealers at a loss. But not petrol after June 2010.
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