Diesel Price in Shimla
Trends change every day in all verticals of the industry. There has been a tremendous changes in the fuel segment such as the arrival of dynamic fuel pricing and GST. Did you know? If you are a diesel consumer from the city of Shimla, this page helps you understand several aspects related to the fuel industry, including fuel rate trends.
Fuel Rate Trends
Fuel was priced at Rs.59.42 per litre on the opening date of January 2018. The closing rate stood at Rs.63.65 per litre. February 2018 began with a price tag of Rs.63.76 per litre and concluded with a price of Rs.61.83 per litre. For March 2018, the opening date and closing date prices were Rs.61.93 per litre and Rs.64.05 per litre respectively. Diesel rates in Shimla have increased by 6.65% and 3.31% in January 2018 and March 2018 respectively. They have fallen by 3.12% in February 2018.
Indian Oil, Hindustan Petroleum and Bharat Petroleum are the leading fuel marketing entities in India. They are publicly-owned and have established several refinery centres across the country. The entire fuel sector is led by HPCL, BPCL and IOCL, which produce and market diesel, petrol, and petroleum products. The city of Shimla also has the fuel dealers of Hindustan Petroleum, Indian Oil and Bharat Petroleum.
Dynamic Fuel Pricing
Fuel companies have started using dynamic fuel pricing to value the fuel. Dynamic fuel pricing is a fuel pricing approach, which determines the fuel rate on the basis of the exchange rate and crude oil overheads. They will either increase the fuel price or decrease the fuel price based on these two parameters. If there are no major changes, fuel prices will not be changed.
Features of Dynamic Fuel Pricing
- It is an advanced fuel pricing system used in India, Japan, Russia and the United States of America.
- The system brings 100% transparency in fuel pricing.
- Fuel buyers are interlinked with global market dynamics.
Benefits of Dynamic Fuel Pricing
- Managing inventory may not be a problem for fuel companies across India.
- Cash budget, which balances cash inflows and cash outflows, can also be easily monitored.
- Operating overheads can be reduced to the possible extent.
- The fuel market in India can be connected with overseas fuel markets.
Options to Trace Diesel Rate in Shimla
Diesel is bought by retail customers. It is widely used by institutional buyers. Checking the fuel price on a daily basis helps institutional buyers to prepare the budget in advance. Retail customers should also check the price since it is varying daily. Today’s diesel price in Shimla can be checked by using mobile applications offered by fuel enterprises. Hindustan Petroleum offers a completely personalised mobile application called My HPCL. Indian Oil also provides a user-friendly mobile application called Fuel@IOC. Similarly, the mobile application developed and offered by Bharat Petroleum is SmartDrive.
Here is a clear explanation for you. If you would like to know the fuel rate fixed at HPCL, download My HPCL. If you are willing to get the fuel price fixed at BPCL, download SmartDrive. Consider downloading Fuel@IOC if you are a loyal customer of Indian Oil to get the latest diesel price in Shimla. This is the best and easiest option for both institutional and retail customers. Another option for people who do not use smartphones is customer care services or SMS services.
Computation of Diesel Price in Shimla
Let’s first understand the parties engaged in the fuel market. BPCL, HPCL and IOCL play a vital role. Their primary business is to borrow crude oil from overseas market and convert the imported crude oil into diesel and petrol. Through dealers, petrol and diesel are marketed to fuel customers. Dealers usually charge a certain percentage of commission.
OMCs have to incur crude oil costs to purchase crude oil. Crude oil is priced in American dollars. If the crude oil cost per barrel is $70 and the USD/INR exchange rate Rs.70, then, the price of crude oil per litre is 70 X 70/159. To the crude oil cost per litre, the total amount of expenses spent by OMCs will be added. On diesel per litre, excise duty is charged at Rs.15.33. When diesel is supplied to fuel stations, the VAT fixed by the concerned government is levied. Shimla is the capital city of Himachal Pradesh, which levies the VAT on diesel at 14.33%.
RSP of diesel in Shimla = crude oil costs + taxes (excise and Value-added Tax) + OMC costs + commission
Factors Affecting Fuel Rates in Shimla
Fuel prices have increased tremendously over the last three months in Shimla. Why are fuel rates increasing? It is mainly because of crude oil costs, which have increased in January 2018 and March 2018. When the crude oil rate increases, fuel rates will be increased by OMCs in India and vice versa. We cannot ignore the impact of the exchange rate. On a daily basis, the exchange rate is reset by the Reserve Bank of India. If the currency of India devalues against the currency of the United States of America, fuel rates are decreased proportionally by OMCs and vice versa.
VAT and excise duty are revised if required. Excise duty has been revised many times by the present NDA Government. It can be further cut to reduce diesel price in Shimla. When excise duty and VAT increase, OMCs will also increase the price tag of fuels and vice versa. Apart from these aspects, fuel prices are also impacted by other international factors such as production cuts, seasonal variations, demand and supply, etc. Production cuts are announced for some reasons. In such cases, the production of unrefined oil is impacted.
Does GST Impact Diesel Price in Shimla?
GST is a common term today. If you buy something, you pay GST. Presently, GST is charged at 5%, 12%, 18% and 28%. When you buy diesel, you do not pay GST. Diesel is out of the regime of GST. The Central Government has to decide whether or not to implement GST on diesel. According to market experts, the inclusion of diesel under GST will completely streamline the tax system.
*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.