Diesel Price in Allahabad
What is the diesel price trend in Allahabad? The trend will depend upon the exchange rate and the price of crude oil. There can be a downward trend or an upward trend based on the changes in these two aspects. Since the implementation of dynamic fuel pricing, diesel prices in Allahabad, a city in Uttar Pradesh, have been fluctuating regularly. In other words, each day has a different price for diesel. This is a prime feature of dynamic fuel pricing, which is now followed in Australia, Japan, the United States of America (USA), etc.
The new price shall be revised every day at 06:00 a.m. at all diesel stations in the city of Allahabad. Diesel customers are suggested to make use of the offline and online facilities to obtain fuel rates on a daily basis. If you download Fuel@IOC, you shall be able to get the latest fuel price offered at Indian Oil Corporation Limited in your city. Downloading My HPCL helps you get the price offered at Hindustan Petroleum Corporation Limited. BPCL customers may download SmartDrive to obtain the current diesel price in Allahabad.
|Also Know: Diesel Price in Uttar Pradesh|
Diesel Cost Trend in Allahabad
Diesel is a costlier fuel in all parts of the country. Allahabad is no different. Since January 2018, diesel price in Allahabad has soared by Rs.7-8 a litre because of a weaker dollar and the increased price of crude oil. Fuel companies have declared a rise in diesel rates in the months of January 2018, March 2018, April 2018 and May 2018. In the month of February 2018, oil companies have announced a downfall in fuel rates in Allahabad. Until 20 June 2018, diesel prices in June 2018 have produced a steady hike in sync with crude oil rates.
The oil and natural gas industry is one of the biggest industries in the country with a vast number of products. Many participants are involved in the industry. Prime participants include fuel retailers, the government, fuel dealers and consumers, oil exporters, etc. Fuel retailers will buy unrefined oil. At refinery centers, they will convert the imported crude oil into refined fuels such as petrol and diesel. Petrol and diesel are marketed through agencies. Each fuel brand has a network of fuel dealers across the country. Fuel dealers will work for a commission.
Computation of Diesel Price in Allahabad
Crude oil cost per litre : Crude oil cost is a major cost aspect, which is determined by oil exporting countries considering various aspects. It was $78.3 per barrel as on 3 June 2018 according to Petroleum Planning and Analysis Cell (PPAC). The exchange rate is taken into consideration to compute the crude oil cost in Indian rupees. Finally, the crude oil cost per barrel is divided by 159 litres to arrive at the cost of unrefined oil per litre.
OMC expenses : OMCs stand for Oil and Marketing Companies. They spend a wide array of expenses. The overall amount of expenses spent by OMCs on petrol and diesel will differ. As on 3 June 2018, entry levies, landing overheads and operational overheads were estimated to be Rs.5.23 a litre. Transportation costs, freight charges and the profit margin of OMCs were estimated to be Rs.2.87 a litre as on the same date.
Taxes : Taxes will constitute more than 50% of the retail selling price of diesel. Excise duty and Value-added Tax (VAT) are charged on diesel and petrol as well. In June 2018, on diesel per litre, excise duty was Rs.15.33; and the Value-added Tax (VAT) was 16.99% on diesel per litre in Allahabad. VAT and excise duty are revised whenever required.
Commission for dealers : Supply stations are owned by retail investors. Fuel dealers will charge a fixed percentage of commission for distributing the fuels to final consumers. As on 3 June 2018, Rs.3.63 was charged on petrol per litre and Rs.2.3 was charged on diesel per litre.
Diesel rate in Allahabad = crude oil costs + excise duty + Value-added Tax + commission for dealers + OMC expenses
Forces Affecting Diesel Rate in Allahabad
VAT was reduced by Uttar Pradesh in the month of October 2017. It was also reduced in Maharashtra, Madhya Pradesh and Gujarat. Fuel rates will fall when the local government decrease VAT. When the local government increases VAT, fuel prices will increase. Excise duty is a central level tax and has the similar effect on fuel rates. It was declined in October 2017 by Rs.2 per litre by the government. Whenever the government revises excise duty, fuel brands have to adjust the price of diesel.
The impact of the exchange rate has been minimal on fuel rates in Allahabad. It will be considered while pricing the fuel every day under dynamic fuel pricing. When the USD/INR depreciates, fuel rates will increase. When the USD/INR appreciates, fuel rates will decrease. Another influencer is the cost of crude oil. If there is a high demand for crude oil in global markets, the cost price of crude oil is expected to increase. If there is a low demand for unrefined oil, crude oil prices will fall. Ultimately, fuel rates will be impacted in all towns, including the city of Allahabad.
Impact of GST on Diesel Price in Allahabad
Goods and Services Tax (GST) is a tax system deployed in India in the month of July 2017. It is a single tax platform for merchants and customers. Fascinatingly, petroleum products have not been brought under the purview of GST. But, GST is levied on other commodities and services. The lowest tax slab is 5% while the highest tax slab is 28%. If GST is imposed on diesel at the highest tax slab, diesel price in Allahabad will decline by a big margin. The government, therefore, is not interested in levying the GST tax structure on diesel and petrol. According to sources, the government may consider bringing these two fuels under GST in the future. It has to make the required changes to keep fuel rates unaffected.
*Disclaimer: BankBazaar makes no guarantee or warranty on the accuracy of the data provided on this page, the prevailing prices are susceptible to change and provided on an as-is basis. We accept no liability for any loss arising from the use of the data contained on this website.