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Petrol Facts June 5, 2008

Posted by astralwicks in Economy, india, oil, oil marketing, Politics, World.
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Is this Spam or True

Petrol Price Breakup

Find the detail break-up of the Final price of petrol available in pumps.

This is a break up considering crude oil at 130 $ per barrel. Following details are for per liter petrol in Rs.

Basic Price = 21.93

Excise duty = 14.35

Education Tax = 0.43

Dealer commission = 1.05

VAT = 5.5

Crude Oil Custom duty = 1.1

Petrol Custom = 1.54

Transportation Charge = 6.00

Total price = Rs 51.90

So for a Rs 22 liter petrol at pumps we people pay Rs 28 tax extra.

Note: all the figures are approximate

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Comments»

1. dogstail - June 8, 2008

More or less correct. there are a lot of finer details, which vary from state to state. VAT seems to be a bit low. Most states have fixed sales tax on Fuels, instead of VAT. Also Transportation is a bit high. But generally that is the basic price of petrol, and the rest is levies and taxes.

I think the taxes are a bit low. They can be a bit higher given the fact that most middle and upper classes use petrol. Even diesel can be costlier. this hopefully will help raise money to build decent public transport infrastructure in every major town.

2. astralwicks - June 12, 2008

initially even i was kind of upset…about the taxes. but I fully support the increase the high taxes. Imagine it any less, children might have petrol cycles or something. Public transport, when will you come to India?

3. V - June 13, 2008

looking forward to metro in mumbai… i wonder if policy makers were sleeping in this part of the country… also hoping that we crack something with fusion energy using hydrogen… read about it as a kid… looked like a dream then also but i’m hoping and praying… if i buy a car it will be one of those battery operated ones…

4. VG - October 21, 2008

Can the author of this story please provide me the source of the information above.

5. astralwicks - October 21, 2008

hi vg it was a viral mail during those months of spike. but the questions means only 1 thing in my opinion – you have a rebuttal. you are welcome.

6. chandran - November 18, 2008

if the price of a barrel of crude oil is $130,
158 litres cost $130 (one barrel is 158litres approx) ie Rs.6240/-
so one litre of crude costs 6240/158 = Rs.39.49

then how come basic price of petrol is given as Rs.21.90 in this break up???

7. astralwicks - November 19, 2008

hi chandran welcome to the blog. As I mentioned in the beginning – is this spam or true? There could be an error.

8. chandran - November 24, 2008

hi astralwicks,

if this is not true, it means that false versions travel around much because i found the same break up quoted in so many websites inclulding the hindu online (if i remember correctly) when i did a google search on petrol price breakup. anyway, i’ll keep trying and let you know if i come up with something. a journalist friend was saying that this could be because the base price itself is administered: or in other words there is a huge subsidy in the base price itself. if so, it’s hard to understand the logic in giving such a large subsidy in the base price and then adding so many taxes and duties thus taking away the benefit from the consumer.

9. astralwicks - November 25, 2008

hi chandran…dogstail the first one to comment on the blog is an oil man. if you go through his comment he is quite cool with the break-up. it is true that most of the price is taxes and marketing and yet we consume so much. the taxes as he says varies from state to state. you can try the petroleum ministry’s website. could be of use.

10. Salil - January 28, 2009

@ chandran and astral wicks:
When u calculate crude trading at around $130 approx. It reflects the price of light crude. Light crude essentially means crude with higher content of volatile components which includes Nat gas, LPG, ATF and gasoline. If u look closer to spot price of gasoline and diesel at the same date it was around $134-135. The simple reason being producing gasoline and diesel are secondary products and hence incur a lot of capital investment. So that translates into around Rs. 43. This price looks closer home. However, we live in India which today can boast off economically viable refineries. Hence, the price of petrol reflects the manufacturing price of gasoline and not its spot price. The price of around Rs. 50 is achieved through a gamut of taxes.

Sadly, we still live in a country which strongly believes in pseudo capitalism. In most of the developed countries, the price of gasoline and diesel varies with season. Gasoline prices are lower (around $2) in winter while steeper in summers.

Cheers!
Salil

11. astralwicks - January 28, 2009

@salil thanks for dropping and that was useful

12. Saurabh - June 25, 2010

btw, there is a calculation mistake in the total. It comes to 58.9 and not 51.9.
I thought Salil’s comments were very insightful.


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