Diesel Price in Belgaum
Have you observed the latest diesel price in Belgaum? If yes, what is the pattern? Is it increasing? Or, is it falling? You may not observe the same trend because of dynamic fuel pricing, which has been introduced in India last year. For a few days, you may observe a falling trend. A growing trend may also be observed for a few days. It all depends on the movements in the exchange rate and crude oil rates. These two components are primarily involved in the Retail Selling Price of diesel in Belgaum.
|Also Know: Diesel Price in Bangalore|
Impact of Dynamic Fuel Pricing on Fuel Prices in Belgaum
Under the dynamic fuel pricing system, the revision of fuel rates in Belgaum will take place on a daily basis. The revision is done by oil companies at 06:00 a.m. on the basis of two important aspects, which include unrefined oil rates and the USD/INR conversion rate. The oil companies then upload the revised diesel rate onto their websites for fuel consumers to refer. Like India, other advanced nations like Japan, the USA and Russia are presently using this mechanism.
Why Dynamic Fuel Pricing?
The dynamic fuel pricing system offers significant benefits over the earlier system. The industry participants such as OMCs, the government, fuel dealers and consumers will be immensely benefited from the mechanism. Unlike before, diesel users in the city of Belgaum cannot face stock-related issues. Fuel pricing will be fully translucent. The key benefit of the system is that the OMCs will instantaneously transfer the disparities in daily unrefined crude oil prices and the exchange rate.
The oil selling corporations, including Indian Oil Corporation Limited, Bharat Petroleum Corporations Limited and Hindustan Petroleum Corporation Limited will be able to manage working capital efficiently. The efficient management of working capital will in turn help OMCs to diminish regular expenses. The OMCs will also be able to design the cash budget appropriately and the time required to manage day-to-day activities.
How do I Trace Today’s Diesel Rate in Belgaum?
Diesel users can be of two types: 1) retail customers, who can be the owners of diesel-run vehicles; and 2) institutional customers, who can be the owners of production units in Belgaum. Both individual and retail users of diesel in the city may consider using mobile applications in order to trace the latest fuel price in Belgaum. They can also accumulate the latest information related to general insurance schemes. As of now, My HPCL, SmartDrive and Fuel@IOC are in use. They all provide premium features.
Assessment of Diesel Price in Belgaum
- Oil companies will set and revise fuel rates. Firstly, they will purchase unrefined oil from OPEC countries. The price is paid in dollars. It will vary based on global market conditions such as the supply and demand pattern, the economics of India and oil-producing countries etc. In March 2018, the market price of crude oil was $65. It worked out to be Rs.4,200.
- In the process of converting crude oil into diesel, the oil companies incur several expenses that are further included. The OMC cost shall be Rs.8.30 a liter as of March 2018, including the refinery transfer price, freight charges, operational expenses, etc.
- Both the state-level and central-level taxes are further added. The central tax is commonly levied in India on diesel. In March 2018, the central levy was Rs.15.33 a litre. The Value-added Tax was levied at 19%. The dealer’s commission on diesel per litre in March 2018 was Rs.2.58 a liter in the city. Finally, the Retail Selling Price of diesel is computed adding all the cost elements.
Factors Affecting Diesel Price in Belgaum
- Exchange Rate: The dollar-rupee exchange rate is the biggest factor affecting the diesel rate in Belgaum. This is the reason why diesel is priced differently each day. The cost of crude oil slides when the INR appreciates against the dollar. It gains when the INR depreciates against the dollar. Eventually, the fuel rates in the city get affected.
- Cost of Crude Oil: If there a hike in the cost of crude oil, the RSP will increase. On the other hand, if there is a drop in the crude oil’s price, then RSP will fall. In January 2018, the steadily growing crude oil rates have made the diesel prices in Belgaum to reach their previous highs.
- Taxes: Taxes can be nationally governed. Oil companies tend to increase the diesel price when the Central Government mounts the central tax on the fuel. They will reduce the fuel rate when the Central Government decreases the excise duty on the fuel. Similarly, if the Government of Karnataka increases the VAT on diesel, the current diesel price in Belgaum will increase. On the other hand, the fuel rate will decrease if the Government of Karnataka decreases the VAT.
Goods and Services Tax vs Today’s Diesel Price in Belgaum
As far as the diesel price in Belgaum is concerned, the Goods and Services System has no effect. The GST is not applicable to diesel as of now. The GST Council has kept it outside to keep the earnings of the government unaffected. It may consider bringing petrol and diesel shortly. The Council must completely rework on the present tax structure to assure that the diesel price will not be lowered.
Also Check Diesel Price in NearBy Cities of Belgaum
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*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.