Diesel Price in Mumbai
Diesel is an important fuel for the development of an economy. It offers a huge array of efficiency, performance, and security features. The fuel also has a greater energy compactness compared to other fuels. Diesel is used everywhere, right from transportation, construction, and industrial production. Needless to say, Mumbai, the capital city of Maharashtra, is the largest consumer of diesel with a big number of diesel-run vehicles. The industrial production and construction sectors are growing briskly and, as a result, diesel is in high demand in the city.
A retail or an institutional diesel consumer somebody like you from Mumbai would want to know the mechanism used to fix the price of diesel, the price breakup of diesel, and the forces impacting the price of diesel. What do you think about the Goods and Services Tax (GST)? Whether or not the GST affects diesel rates. Besides, there are many news around diesel this fiscal year. Have you observed? The following sections will discuss each of these aspects in detail:
|Also Check: Diesel Price in Naded|
Trend in Diesel Price in Mumbai
Diesel rates in Mumbai were moving in an upward direction since 16 June 2017 until 3 October 2017. The current rate is Rs.60.55. It fell by Rs.2.27 since the central government cut the excise duty by Rs.2 on diesel. Let’s analyse prices month by month:
Rates have grown by 2.96% in September. The highest rate was Rs.62.58 whereas the lowest Rs.60.68. In August, the lowest price was Rs.59.04 whereas the highest Rs.60.96. Prices have increased by 2.57% for the entire month. On the opening day of July, diesel was priced at Rs.58.53 and at Rs.59.08 on the closing day. Rates were up by Rs.0.76 for the complete month.
|Also Know: Petrol Price In Mumbai|
Diesel Rates in Mumbai and other Prime Towns
After cutting the central excise duty, diesel has become cheaper across all metro cities of India. Needless to say, diesel and petrol rates in the capital city of Maharashtra are comparatively more. Prices are expected to be stable over the next month.
Diesel Price Trend in Mumbai between July and September 2018
|Opening date price||Rs.71.49 per litre||Rs.72.15 per litre||Rs.74.76 per litre|
|Closing date price||Rs.72.04 per litre||Rs.74.59 per litre||Rs.79.40 per litre|
|Highest price||Rs.72.69 per litre||Rs.74.59 per litre||Rs.79.40 per litre|
|Lowest price||Rs.71.49 per litre||Rs.72.15 per litre||Rs.74.76 per litre|
Diesel Price Trend in July 2018 in Mumbai
- The trend in diesel price is based on the price revision that will happen regularly. The prime determinants of diesel and petrol rates in Mumbai, the capital city of Maharashtra, include oil prices and the FX rate.
- Both factors are equally influential. The higher the price of petroleum rate, the higher the fuel price and vice versa. The falling rupee will impact the fuel price to go up whereas the strengthening rupee shall affect the price to fall.
- In June 2018, the cost of petroleum was $73.83 per barrel (average price) and has fallen to $73.47 per barrel in July 2018.
- The USD’s exchange rate against the domestic currency has increased to 68.52. At the beginning of the month, it was 68.47. Because of the weakened rupee, the oil marketing enterprises hiked the fuel rate by 0.76%.
- Sometimes, the government may increase or decrease the excise duty according to circumstances. OMCs, which revise fuel prices, will ponder the value-added tax and sales tax for fuel pricing.
- The highest diesel rate for the month was Rs.72.69 per litre whereas the lowest diesel price was Rs.71.49 per litre.
Diesel Rate Trend in August 2018 in Mumbai
- In the first and last weeks of August, the price was increased marginally whereas in the second and fourth weeks, it was stable.
- On 1 August 2018, OMCs sold diesel at a price of Rs.72.15 per litre and on 7 August 2018, the price increased by 60 paise per litre.
- OMCs retailed diesel at a price of Rs.72.76 per litre in the week 2 and Rs.73.14 per litre in the week 3.
- Likewise, diesel continued to retail at a price of Rs.73.49 on 24, 25 and 26 August 2018 in the city of Mumbai. In the last three days, oil companies increased the fuel price by 50 paise per litre.
- Once again, the weakened rupee has caused a growth rate of 3.38% in Mumbai in August 2018. The cost of crude oil also fell.
- The highest rate fell on the last day of the month because of the stability in the prices of diesel. Similarly, the lowest price was noticed on 1 August 2018.
Diesel Price Trend in September 2018 in Mumbai
- The price paid by a fuel consumer includes the sales tax, which is levied by the State Government of Maharashtra, and the excise duty, which is levied by the Central Government.
- If the Centre cuts the excise duty, the RSP has to be decreased. When the government increases the excise duty, the RSP has to be increased.
- Over the last three months, the excise duty on a litre of diesel was constant. The sales tax was also constant.
- The trend was completely decided on the basis of the transactional influencers: 1) crude oil rates and 2) the currency conversion ratio.
- According to Petroleum Planning Analysis Cell, in September 2018, unrefined oil rates decreased by more than $5 per barrel.
- The pace at which the INR devalued versus the USA’s currency is higher this month compared to July and August. Thus, diesel price in Mumbai has accelerated by 6.20%.
Additional Information: The fuel sector in India is led by Indian Oil Corporation Limited, Hindustan Petroleum Corporation Limited and Bharat Petroleum Corporation Limited. There are a few private players as well. Diesel price in Mumbai between July 2018 and September 2018 is a combined report produced using the reliable sources. There is no precise way to forecast the trend. Crude oil price is linked with several global aspects and even the FX rate is influenced by global economics.
Quarterly Diesel Price Trend in Mumbai between April and June 2018
|Opening date price||Rs.68.77 a litre||Rs.70.20 a litre||Rs.73.71 a litre|
|Closing date price||Rs.70.20 a litre||Rs.73.76 a litre||Rs.71.49 a litre|
|Highest price||Rs.70.24 a litre registered on 24th||Rs.73.83 a litre registered on 29th||Rs.73.71 a litre registered on 1st|
|Lowest price||Rs.68.77 a litre registered on 1st||Rs.70.20 a litre registered on 1st||Rs.71.49 a litre registered on 29th|
Diesel Price Trend in Mumbai in April 2018
- The price of diesel per litre shall be revised based on dynamic fuel pricing by Indian oil marketing companies such as Bharat Petroleum, Hindustan Petroleum and Indian Oil.
- Dynamic fuel pricing was introduced to revise the price of diesel on a daily basis. It has been in place since June 2017.
- On 1st, diesel price in Mumbai stood at Rs.68.77 a litre. Under dynamic fuel pricing, fuel companies have marketed the fuel at an average price of Rs.68.97 a litre during the first week of April.
- Gradually, the fuel rate has increased to Rs.69.23 a litre on 14th. By the end of the third week, the fuel price was further soared to Rs.69.70 a litre in Mumbai, the capital city of Maharashtra.
- Since the price of crude oil has increased, diesel rates in the metro city of Mumbai have increased to Rs.69.91 a litre on 22nd, Rs.70.05 a litre on 23rd, and Rs.70.24 a litre on 24th respectively.
- The fuel was sold at Rs.70.20 a litre on 25th, 26th, 27th, 28th, 29th and 30th triggered by the unchanged overseas factors.
Diesel Price Trend in Mumbai in May 2018
- The closing date price for the previous month turned out to be the opening date price for this month. At all the fuel stations, diesel price per litre remained unchanged at Rs.70.20 a litre on 1st, 2nd, 3rd, 4th, 5th, 6th,7th,8th, 9th,10th and 11th.
- Fuel companies also take into account excise duty and Value-added Tax while determining the fuel rate. Neither excise duty nor Value-added Tax was revised in April and May.
- So, it can be interpreted that an upsurge of 5.07% in diesel prices was triggered only by the increased crude oil expenses.
- Since oil marketing companies borrow unrefined oil from oil-exporting countries such as OPEC, the currency conversion rate will impact the crude oil rate. The Indian currency has fallen minutely against the USD this month.
- But, the revision of diesel rates in the capital city of Maharashtra was not affected by the exchange rate in this month.
- Other domestic forces such as the OMC expenses, the commission for dealers, pollution cess and the profit margin of the OMCs were not changed.
- In Mumbai, the highest diesel rate for the month stood at Rs.73.83 a litre on 29th whereas the lowest diesel price stood at Rs.70.20 a litre.
Diesel Price Trend in Mumbai in June 2018
- June 2018 began with a downward trend in tandem with international influencers. The opening date price for this month was down by 5 paise per litre. By the completion of the first week, the fuel rate was slashed to Rs.73.21 a litre.
- The fuel rate was further reduced to Rs.72.24 a litre on 14th and Rs.72.02 a litre on 21st because of the sluggish unrefined oil market but not because of other factors such as excise duty and Value-added Tax (VAT).
- At Indian Oil Corporation Limited, the lowest and highest diesel rates in the city of Mumbai stood at Rs.71.49 a litre and Rs.73.71 a litre respectively.
- In this month, all the state-run fuel companies such as Bharat Petroleum, Hindustan Petroleum and Indian Oil have decreased diesel rates by 3.01% as the oil-exporting countries have reduced the crude oil price per barrel.
- Between April 2018 and June 2018, diesel price per litre in Mumbai has increased to Rs.71.49 a litre from Rs.68.77 a litre.
Trend in Diesel Price in Mumbai between January and March 2018
|Opening date price||Rs.63.43 per litre||Rs.68.25 per litre||Rs.66.35 per litre|
|Closing date price||Rs.68.15 per litre||Rs.66.17 per litre||Rs.68.58 per litre|
|Highest price||Rs.68.15 per litre booked on 31st||Rs.68.37 per litre booked on 6th and 7th||Rs.68.58 per litre booked on 31st|
|Lowest price||Rs.63.43 per litre booked on 1st||Rs.66.17 per litre booked on 28th||Rs.66.35 per litre booked on 1st|
Trend in Diesel Price in Mumbai in January 2018
- The base currency was down 0.24% to Rs.63.69 on 1, 0.35% to Rs.63.47 on 2nd, 0.04% to Rs.63.44 on 3rd, 0.05% to Rs.63.41 on 4th, and 0.1% to Rs.63.35 on 5th. A steady fall in the exchange rate affected the fuel price to increase.
- So, the price as of the opening date soared to Rs.63.43 per litre. The growth rate for the first week stood at 1.02%.
- In Mumbai, 24.86% Value-added Tax (VAT) and the excise duty of Rs.15.33 a litre were levied until the last day. They had no impact on the variations in the diesel price in the city.
- The fuel rate increased to Rs.65.74 a litre on 15th because of a 1.76% hike in the crude oil’s cost, Rs.66.91 a litre on 21st, and Rs.67.99 per litre on 28th in sync with the movements in the cost of WTI Crude and Brent Crude.
- At 7.44%, a growing trend was announced at Indian Oil Corporation Limited, Hindustan Petroleum Corporation Limited and Bharat Petroleum Corporation Limited for the whole month.
- In Mumbai, the multi-year high was breached at Rs.68.15 a litre on 31st. A new high price was also offered in Delhi, Kolkata and Chennai.
Trend in Diesel Rate in Mumbai in February 2018
- Irrespective of the declaration of the Union Budget, on 1st, the new price was offered under the daily revision system at Rs.68.25 per litre, which was up 10 paise per litre.
- It is the steady demand for unrefined oil that caused a 0.17% rise in the fuel price on 7th. The OMCs booked the highest price at Rs.68.37 per litre within the first 6-7 days.
- After 8th, the offer started reducing. The downward trend was observed until the third week, which concluded with an offer of Rs.66.32 per litre.
- Once again, on 21st, diesel accumulated its value by 1 paisa. The fuel price travelled downwards until the end of the month.
- On 22nd, the offer was down 1 paisa to Rs.66.32 per litre, 9 paise to Rs.66.23 per litre on 23rd, 5 paise to Rs.66.18 per litre on 24th, and 2 paise to Rs.66.16 per litre on 25th.
- This steady fall was instigated by the cost of crude oil. A 5.53% globule in the Indian Basket average crude oil was reported by HPCL, BPCL and Indian Oil in February.
Trend in Diesel Price in Mumbai in March 2018
- Like the first two months, the VAT and the central tax were retained unaffected by the State Government of Maharashtra and the Central Government of India.
- Alternatively, a 3.36% increase was not caused by the domestic factors. The overseas factors such as the crude oil market and the Foreign Exchange market (FX market) had a reasonable impact on the diesel prices in Mumbai
- In the first week, the USD/INR fell to Rs.64.89 and Rs.64.85 in the second week. Therefore, the fuel companies hiked the fuel rate to Rs.67.10 per litre on 7th, Rs.67.15 a litre on 23rd, Rs.67.91 per litre on 28th , and Rs.68.58 per litre on 31st.
- For the month, the lowest and highest prices were declared at Rs.66.35 a litre and Rs.68.58 per litre respectively.
- On the other hand, the lowest price for the quarter stood at Rs.64.43 per litre and the highest price for the quarter stood at Rs.68.59 per litre.
- This quarter the diesel rate in Mumbai was up 8.11% since crude oil in global markets gained its price reasonably.
Note: India considers the aggregated price of WTI and Brent in order to revise the existing fuel rates. Over the last 10 months, the WTI and Brent prices have gone up 10-15%. Therefore, both the diesel and petrol prices accelerated considerably.
What is the Mechanism for Revising Diesel Price in Mumbai?
The fortnightly-based revision has now been replaced by the daily revision since 16th June 2017. All diesel outlets in the city will update fuel prices on a day-to-day basis. Diesel is priced based on two important considerations: 1) the performance of crude oil in overseas markets and 2) the performance of the Indian currency against the currency of the United States of America.
Neither the central government nor the state government has no scope to influence the pricing of diesel under the new system. Fuel consumers shall now pay the rates, which are determined by two factors mentioned in the previous section. The move is beneficial for consumers and dealers as well. In fact, the daily revision is being practiced by two major economies of the world: 1) the United States of America and 2) Australia.
|Also Check: Diesel Price in Maharashtra|
The move not only entrusts transparency in fuel pricing but also fosters the best stock management practices. Since all oil marketing companies are practicing the daily revision, they have framed a few customer-friendly recipes to track the recent updates. For instance, customers can send a text message or dial the customer care number requesting for current rates.
How are Diesel Prices in Mumbai Calculated?
The cost of a litre of diesel in Mumbai is assessed by adding the cost price of crude oil (including freight charges), the cost of converting raw oil into diesel (called as the refinery transfer price), the element of tax imposed on diesel by the state and the central, the commission paid to dealers for supplying diesel from refinery centres, and pollution cess. These are various elements of the price structure of the fuel.
The average price of oil is projected to be $52 for the current fiscal year. Projections are made by the United States (US) Energy Information Administration on a monthly basis. Diesel, as mentioned in the earlier section, is a widely used commodity and taxed by the state and the central. The tax component is subject to fluctuate. Currently, the government of Maharashtra levies 21% VAT on diesel.
Refinery transfer price (RTP) is the cost incurred by oil marketing companies (OMCs) to convert unrefined oil into diesel. Oil marketing companies add their profit margin on the buying cost of crude oil and the cost of refineries. The commission, which is charged by dealers, is fixed per litre. It may change within the Mumbai city.
Forces Affecting Diesel Price in Mumbai
The retail selling price (RSP) of diesel in Mumbai, like any other cities in India, is impacted primarily by the cost price of crude oil, the exchange rate, and the tax component. On the other hand, the purchasing price of unrefined oil is affected by seasonal variations, weather reports, global demands, global political moves, overseas surpluses and supplies, and the currency conversion ratio.
The Cost of Diesel will increase if:
- The cost of crude oil increases.
- The Indian currency deteriorates against the base currency (USD).
- The central or the state increase the tax component on diesel.
On the other hand, the Cost of Diesel will decrease if:
- The cost of crude oil reduces.
- The Indian currency bounces back against the base currency (USD).
- The tax component is decreased by the state and the central.
How does the GST Impact Diesel Price in Mumbai?
Goods and Services Tax (GST) now replaces all indirect tax forms. All taxpayers are brought under the common taxation platform. GST is the biggest reform in the history of Indian tax system since Independence. The GST regime does not influence all petroleum products and the entire oil and natural gas industry since they have kept outside the purview of GST. The execution of GST on petroleum products makes them cheaper for consumers. The compliance cost incurred by all industry stakeholders will increase by 200%.
Petrol Cost vs. Diesel Costs in Mumbai
As on 10 October 2017 (the current rate of diesel), diesel was priced at Rs.60.55 a litre whereas petrol at Rs.77.58. The net difference as on the latest date was Rs.17.03 in the city.
Also Check Diesel Price in NearBy Cities of Mumbai
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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.