Diesel Price in Tamil Nadu
The Indian state Tamil Nadu is located in the southernmost part of Indian peninsula. Major cities in the state include Chennai, the capital and the largest city, Coimbatore, Madurai and Salem.
With the major cities in the state developing at a rapid pace, the state’s dependency on fossil fuels like diesel has been increasing.
In that regards, let us see a few more details about the diesel price in Tamil Nadu compared to other south Indian states, factors affect the price, how often diesel prices are revised and other information about diesel and its pricing that would give a few insights about the topic.
Diesel Price in Tamil Nadu Compared to other South Indian States
Diesel price in Tamil Nadu compared to other south Indian states such as Andhra Pradesh, Telangana, Karnataka, and Kerala is the second lowest with a litre of diesel trading at Rs.60.02/Lt on 13 October 2017. The lowest price in offered in Karnataka, which abolished entry tax on diesel leading to reduced fuel prices in the state.
The second lowest diesel rate in Tamil Nadu can be attributed to tax rate charged by the state government which compared to other south Indian states is again the second lowest.
Factors Affecting Diesel Price in Tamil Nadu
Tamil Nadu, similar to other Indian states, levies value added tax (VAT) on every litre of diesel sold in the state. The rate of tax is what makes diesel price in Tamil Nadu different from other states. Therefore, tax becomes the primary factor that affects diesel price in the state. Any revision, either upward or downward, would directly impact the price of diesel across all the cities and towns in Tamil Nadu.
Besides the state specific tax, other factors that commonly affect diesel price in Tamil Nadu and in other Indian states are
- International crude oil prices
- Currency exchange rate
- Central government taxes
- Profit margins and dealer commissions
The two factors that impact diesel price on a daily basis are the global crude oil prices and the currency exchange rate.
- Crude Oil Prices: Ever since dynamic fuel pricing was implemented in India, diesel prices in India are aligned with the international crude prices on a daily basis.
|Also Check: Diesel Price in Chennai|
Crude oil prices are typically volatile in nature as they are determined based on various other factors such as the demand and supply metrics, political stability in the oil producing nations, climatic conditions, and similar other factors. The recent hurricane in the United States is one such example which damaged many oil refineries across the country resulting in reduced oil production. Less supply led to higher demand thus higher oil prices.
India being major importer of crude oil purchases more than 70% of its oil requirements from other countries. Daily diesel price will be calculated based on the rate at which international crude oil is being traded on that particular day. Hence, any slight change in the global crude price would impact the retail selling price of diesel in India.
- Currency Exchange Rate: The second element that affects the diesel on a daily basis is the US dollar to Indian rupee exchange rate. Globally oil trading happens in US dollars. Whenever the dollar value strengthens, oil companies have to shell out more money to purchase oil, hence the fluctuating dollar price becomes another factor that affects diesel price.
- Central Taxes: Just like the state governments, the central government also earns significant revenue on diesel by collecting excise duty on every litre of diesel sold in the country. Though the excise duty does not change on a daily basis, any revision in the tax would affect the diesel price across the country. Recently, there was a reduction in the excise duty on diesel by Rs. 2/Lt, effective from 4th October, which brought down diesel rate across the country.
- Profit Margins and Dealer’s Commission: Who would do a business without profits and so are the Indian oil companies and petrol pump dealers. The downstream oil market in India, which includes refining, processing and purifying of crude oil, along with the marketing and distribution of end products, is dominated by state-owned oil companies such as Indian Oil Corporation, Hindustan Petroleum and Bharat Petroleum, which captured more than 90% market share. Private players such as Reliance, Essar, Shell and others occupy the remaining market share.
These companies add marketing and distribution costs as well as their profit margins to the diesel price before selling it to the petrol pump dealers. They would revise the margins whenever necessary. Though not often, any change in the margins will also impact diesel price.
Once the petrol pump dealers purchase diesel from the oil companies, they add their commission, which factors in employee minimum wage, to every litre of petrol sold at their station. The oil companies usually decide the dealer’s commission and would revise the same once every year. The revision of commission also impacts the diesel price.
Quarterly Diesel Price Trend in Tamil Nadu Between October and December 2018
|Opening date price||Rs.79.48 a litre||Rs.78.05 a litre||Rs.71.19 a litre|
|Closing date price||Rs.78.05 a litre||Rs.71.60 a litre||Rs.66.31 a litre|
|Highest price||Rs.80.10 a litre booked on the 17 October 2018||Rs.78.05 a litre booked on the 1 November 2018||Rs.71.19 a litre booked on the 1 December 2018|
|Lowest Price||Rs.77.16 a litre booked on the 5 October 2018||Rs.71.60 a litre booked on the 30 November 2018||Rs.66.31 a litre booked on the 31 December 2018|
Diesel Price Trend in Tamil Nadu Between October and December 2018
- Prices of diesel and petrol are revised daily by State-run oil companies under the ‘Dynamic Fuel Pricing’ mechanism which considers the 14-day average price of crude oil along with the exchange rate of the rupee over the US dollar.
- Based on this method, diesel was priced at Rs.79.48 per litre on 1 October in Tamil Nadu, which was a record high due to the rising oil prices in the global market.
- Prices continued to rise significantly which prompted the Central government to announce a reduction on the excise duty levied on the sale of fuel by Rs.1.50 per litre and asked oil firms to absorb further subsidy of Rs.1 per litre.
- This prompted diesel to register the lowest price of the month when it was sold at Rs.77.16 per litre on 5 October.
- However, it rose almost immediately to touch the highest rate on 17 October when it was priced at Rs.80.10 per litre as crude oil prices were trading at record highs.
- By the end of the month, diesel prices fell to register a 1.80% during the month prompted by the cut in excise duty.
- On 1 November, diesel was priced at Rs.78.05 per litre – the highest price recorded during the month.
- Diesel prices in Tamil Nadu during this month declined backed by the slight fall in the global crude oil prices in the market.
- By the end of the month, diesel recorded its lowest rate for the month when it was priced at Rs.71.60 per litre on 30 November.
- Overall, diesel rates in Tamil Nadu during this month dropped significantly by 8.27% attributed to steep fall in the global crude oil price.
- In December, diesel opened the month at Rs.71.19 per litre in Tamil Nadu, which was also the highest rate recorded during the month.
- Crude oil prices in the international market were trading around $55 per barrel late December as against $80 per barrel early October prompting oil firms to reduce the diesel and petrol price in the country.
- By the end of the month, the diesel price trend in Tamil Nadu during December declined by 6.86% as the crude oil price dropped and the rupee’s marginal appreciation over the US dollar.
Quarterly Diesel Price Trend in Tamil Nadu between July and September 2018
|Opening date price||Rs.71.12 a litre||Rs.71.62 a litre||Rs.74.46 a litre|
|Closing date price||Rs.71.66 a litre||Rs.74.23 a litre||Rs.79.08 a litre|
|Highest price||Rs.72.48 a litre recorded on the 15th||Rs.74.23 a litre recorded on the 31st||Rs.79.08 a litre recorded on the 30th|
|Lowest Price||Rs.71.12 a litre recorded on the 1st||Rs.71.62 a litre recorded on the 1st||Rs.74.46 a litre recorded on the 1st|
Diesel Price Trend in Tamil Nadu in July 2018
- In Tamil Nadu and other states of the country, diesel and petrol prices are revised every day by State-run Oil Marketing Companies (OMCs) under the dynamic fuel pricing mechanism. New rates are effective 6:00 am IST.
- Under the dynamic pricing mechanism, oil companies include the global crude oil rate and the exchange rate of the Indian currency over the U.S. dollar.
- Based on the pricing mechanism, the diesel price in Chennai - the capital city of Tamil Nadu - on the 1st stood at Rs.71.12 per litre. This was also the lowest diesel price registered in July 2018.
- Prices were kept unchanged until the 5th before it was increased by 12 paise per litre to stand at Rs.71.24 per litre.
- Diesel prices during the first and second weeks inclined to touch the highest diesel price recorded for the month when a litre of diesel was available at Rs.72.48 on the 15th.
- The increase in diesel prices was felt across the country due to the marginal increase in the global crude oil prices.
- By the end of the month, prices declined; however, not lower than the opening price of the month.
- The closing price of diesel for the month stood at Rs.71.66 per litre, an increase of 54 paise per litre when compared to the opening price.
- Overall, the diesel price trend in Tamil Nadu during July inclined by 0.76% impacted by the slight rise in oil prices in the global market.
Diesel Price Trend in Tamil Nadu in August 2018
- In accordance with the daily revision, the diesel price in Chennai was changed on the 1st of August and a litre of the fuel was sold at Rs.71.62, which was also the lowest diesel price for the month.
- With the U.S. administration pulling out the nuclear deal with Iran, there were apprehensions of possible shortage in oil supply which prompted the oil price to trade higher.
- Diesel prices in Tamil Nadu during the first and second weeks of August inclined marginally in the back of a rising oil price.
- Some states in the country such as Rajasthan, West Bengal and Andhra Pradesh announced a reduction in the VAT levied on petrol and diesel; however, in Tamil Nadu the tax rates remained the same.
- In tandem with the increase in oil prices in the global market, diesel prices during the month inclined to touch the highest price on the 31st when a litre of diesel was available at Rs.74.23 in Tamil Nadu.
- During the course of the month, the diesel price trend in Tamil Nadu grew by 3.65% impacted by the increase in the global crude oil price.
Diesel Price Trend in Tamil Nadu in September 2018
- On the 1st of September, oil companies hiked diesel prices in Tamil Nadu by 23 paise per litre to be sold at Rs.74.46 per litre. This is also the lowest price recorded during the month in the State.
- Diesel prices continued to increase over the course of the first and second weeks even as crude oil price moved upwards.
- Additionally, the Indian currency depreciated to its lowest trading at Rs.72 over the U.S. dollar prompting fuel prices to rise significantly.
- While the global crude oil price rose to touch a four-year high of $80 per barrel, the rupee’s exchange rate was at its lowest ever of 72.
- By the end of the month, diesel prices in Tamil Nadu and across other states touched record levels offering no relief to consumers.
- On the 30th of the month, the diesel price in Tamil Nadu touched the highest for the month when a litre was sold at Rs.79.08.
- Overall, the diesel price trend in Tamil Nadu in September grew significantly by 6.20% mainly influenced by the rise in crude oil prices and the fall in the exchange rate of the Indian currency.
Quarterly Diesel Price Trend in Tamil Nadu between April and June 2018
|Opening date price||Rs.68.12 a litre||Rs.69.56 a litre||Rs.73.10 a litre|
|Closing date price||Rs.69.56 a litre||Rs.73.16 a litre||Rs.71.12 a litre|
|Highest rate||Rs.69.60 a litre recorded on the 24th||Rs.73.22 a litre recorded on the 29th||Rs.73.10 a litre recorded on the 1st|
|Lowest rate||Rs.68.12 a litre recorded on the 1st||Rs.69.56 a litre recorded on the 1st||Rs.71.12 a litre recorded on the 30th|
Diesel Price Trend in Chennai in April 2018
- Fuel was offered at a price of Rs.68.12 a litre as on 1 April 2018 in Chennai, the capital city of Tamil Nadu. The same price was also offered in other prime cities of Tamil Nadu, including Salem, Thanjavur, Vellore, Erode, etc.
- The pricing of diesel is purely based on the exchange rate, the USD/INR, and international crude oil rates. Any changes in excise duty and Value-added Tax are taken into account to price the fuel if any.
- In this month, both forms of taxes were not revised. The changes in the exchange rate and crude oil rates influenced the pricing of diesel completely.
- Under dynamic fuel pricing, diesel rates in the city of Chennai were retained unchanged at Rs.68.41 a litre on the 3rd and the 4th. They were also constant at Rs.69.56 a litre on the 25th, the 26th, the 27th, the 28th, the 29th and the 30th.
- Compared to the previous month, the average crude oil cost per barrel was increased by oil-producing countries such as OPEC and Iran in April 2018.
- Therefore, fuel companies such as Bharat Petroleum Corporation Limited, Hindustan Petroleum and Indian Oil increased the fuel rate by 2.11%.
Diesel Price Trend in Chennai in May 2018
- Crude oil rates were steady at the beginning of this month. The fluctuations in the exchange rate were not noticeable. Because of this reason, the fuel was marketed at a price of Rs.69.56 a litre in the first week.
- By the end of the second week, the fuel price in Chennai was revised to Rs.69.83 a litre. Fuel companies further increased the price of diesel per litre to Rs.71.63 a litre on the 21st and Rs.73.07 a litre on the 28th.
- In May 2018, diesel was retailed at the highest rate of Rs.73.22 a litre on the 29th and the lowest rate of Rs.69.56 a litre on the 1st. In this month also, neither the State Government of Tamil Nadu nor the Central Government of India revised the taxes.
- Petroleum Planning and Analysis Cell, which is the statistical wing of the Oil Ministry, reported a reasonable hike in crude oil rates. Because of this fact, fuel rates were up 5.17% to Rs.69.56 a litre in May 2018.
- Neighboring states of Tamil Nadu such as Karnataka, Kerala and Andhra Pradesh also produced the same trend as far as diesel rates are concerned.
Diesel Price Trend in Tamil Nadu in June 2018
- On 1 June 2018, diesel price in Tamil Nadu was down by 6 paise per litre compared to the previous day’s price. It dropped to Rs.72.97 a litre on the 2nd and the 3rd.
- When revised on the 14th of June 2018, the fuel rate stood at Rs.71.62 a litre. The oil marketing companies further dropped the fuel price to Rs.71.48 a litre on the 21st and Rs.71.12 a litre on the 28th.
- During this quarter, excise duty on diesel per litre was Rs.15.33 whereas the sales tax levied by the State Government of Tamil Nadu was 24%. Taxes had no impact on the pricing of diesel per litre.
- In tandem with unrefined oil rates, diesel rates not only in Chennai but also in other major cities such as Salem, Erode and Vellore were down by 2.70%.
- On the 1st, the highest fuel rate was booked at Rs.73.10 a litre. This was also the highest fuel rate for the quarter as well.
- With a span of three months, the price of diesel per litre across the state of Tamil Nadu was up by 5.87%.
Trend in Diesel Price in Tamil Nadu between January and March 2028
|Opening date price||Rs.62.96 a litre||Rs.67.06 a litre||Rs.65.68 a litre||Rs.63.38 a litre||Rs.67.99 a litre||Rs.66.20 a litre|
|Closing date price||Rs.67.05 a litre||Rs.65.50 a litre||Rs.67.93 a litre||Rs.67.99 a litre||Rs.66.01 a litre||Rs.68.41 a litre|
|Highest price||Rs.67.05 a litre booked on 31st||Rs.67.71 a litre on 5 and 6th||Rs.67.93 a litre booked on 31||Rs.67.99 a litre booked on 31st||Rs.68.22 a litre booked on 6th||Rs.68.41 a litre booked on 31st|
|Lowest price||Rs.62.96 a litre booked on 1st||Rs.65.49 a litre on 25th||Rs.65.68 a litre booked on 1||Rs.63.38 a litre booked on 1st||Rs.65.97 a litre booked on 26th||Rs.66.20 a litre booked on 1st|
Trend in Diesel Price in Tamil Nadu in January 2018
- The diesel price in Chennai is higher compared to that of in Coimbatore owing to transportation overheads. Other aspects such as the excise duty, the dealer’s commission and the VAT remained unchanged in these two prime cities in Tamil Nadu.
- In Tamil Nadu, the fuel market began with a growing tendency. Throughout the month, the fuel prices were neither constant nor decreased according to dynamic fuel pricing system.
- It is owing to the stabilised demand for unrefined oil in international markets and a slightly weakened USD. Higher the demand for crude oil, the higher will be the cost of crude oil and vice versa.
- At Rs.67.05 a litre, a multi-year high was broken in the city of Chennai on 31st. Similarly, in Coimbatore, the highest price was avowed at Rs.67.99 a litre on 31st. Market watchers have stated that the highest price record will be breached in the forthcoming months.
- BPCL, HPCL and Indian Oil have reported a rise in all the notable towns in Tamil Nadu. The fuel rates were up 6.49% and 7.27% in Chennai and Coimbatore respectively because of the notable changes in the overseas price influencers.
Trend in Diesel Rates in Tamil Nadu in February 2018
- Fuel prices are anticipated to change whenever the Central Government implements the new budget, but the scenario was different this year.
- Despite a few variations in the BJP-led Government’s budget for the financial year 2018-2019, the diesel consumers in Tamil Nadu continued to pay the same RSP on 1st.
- Unlike January, you can watch a mixed retort from the fuel rate. Until the first week, it travelled upwards. Afterwards, the OMCs began plunging the rate on the basis of the global considerations.
- There was a steep collapse in the demand for the commodity and thus, the prices of Brent and WTC have dampened significantly.
- Compared to the earlier month, the greenback slowly rebounded its value against the currency of India. Consequently, crude oil costs were impacted to some extent.
- After 25th, an upward tendency was detected in Chennai and Coimbatore. Other prime cities in Tamil Nadu have proclaimed the same result.
- The sluggish crude oil market caused a 2.32% decrease in the capital city of Tamil Nadu and a 2.91% drop in Jodhpur, the second biggest city.
Trend in Diesel Prices in Tamil Nadu in March 2018
- The crude oil’s demand was reported to be steady during the first week of March. Therefore, the opening date diesel price was up by a few paise compared to the last day’s price.
- Compared to January, the weekly growth rates have been lower primarily because of the ups and downs in the currency conversion ratio.
- In India, the RBI declares the translation rate of the USD against the INR considering various domestic and international elements. The USD/INR exchange will be revised on a daily basis in the Forex Market.
- Especially in the month of March, the impact of the currency exchange rate has been minimal. A reasonable gain in the overseas crude oil rate has impacted a 3.33% rise in the diesel rate in Coimbatore and a 3.42% upsurge in the diesel price in the capital city.
- In this quarter, the excise duty and the VAT were not revised. Moreover, there were no variations in the dealer’ commission and the overheads spent by the Indian OMCs, including HPCL, BPCL and Indian Oil.
- Under the daily price revision framework, not only in Tamil Nadu but also in other states, diesel has gained its price more than 7% this quarter. The fuel consumers across the country are expecting a cut in the excise duty by the Central Government.
State Taxes and Diesel Price in Tamil Nadu
The Tamil Nadu government currently levies value added tax (VAT) of 25% on a litre of diesel, which compared to other south Indian states in the second lowest with the lowest levied by Karnataka government.
The latest tax revision in the state took place in March 2017, when the government increased the tax from 21.4% to the current 25%. VAT on petrol was increased from 27% to 34%. With the revised tax rate, diesel in the state became costlier by Rs.1.70/Lt and petrol by Rs.3.78/Lt in the same month.
How often Diesel Prices are Revised in Tamil Nadu
In Tamil Nadu, just like in other states in India, diesel prices are revised on a daily basis. Ever since dynamic fuel pricing was introduced in India, diesel prices have been linked to the global crude oil prices.
Just like gold prices, petrol and diesel prices in India are now revised every day based on the international crude oil price and currency exchange rate. This enables the oil companies to pass even the slightest change in the product price and exchange rate fluctuation immediately to the end user.
Customers are expected to benefit from this model of pricing as the daily fluctuation remains within manageable units of currency unlike the previous fortnightly revision wherein the price adjustment was often high.
The new pricing mechanism also brings transparency in fuel pricing as well as encourages automation of petrol pumps while enabling better stock management practices at the stations.
All the petrol pumps in Tamil Nadu, as per the new policy, should update the revised diesel price everyday by 6 a.m. The updation will be done automatically at the automated stations, while the rest have to do it manually by fetching the revised prices from the respective OMCs.
Customers can find the daily revised price of both diesel and petrol on the websites of the oil companies.
Effect of GST on Tamil Nadu Diesel Price
Goods and services tax or GST has been introduced in India in July 2017 to bring uniformity in tax rates across the country. Post implementation of GST, the rates of many goods and services got affected due to the revised tax rates.
The price of diesel and petrol, however, remained unaffected as the fuel products are currently exempted from the new tax regime. Diesel and other petroleum products are still being taxed as per the old tax regime, which includes both state and central government taxes. While the central tax remains constant across the states, the state-level tax on diesel varies from state to state. The respective states still have the right to decide the percentage of tax to be levied on the petroleum products.
Hence, the effect of GST on diesel price in Tamil Nadu and in other Indian states is nil for now. If diesel is brought under GST, its price will get affected based on the new tax rate. If the new tax is less than what is being charged now, the rate of diesel in Tamil Nadu will certainly come down.
Diesel Costs versus Petrol Costs in Tamil Nadu
The average price difference between petrol and diesel in Tamil Nadu is about Rs 10-11/Lt. The difference in price is mainly due to the difference in the VAT being levied on both the commodities.
Currently, the central excise duty on diesel is Rs. 15.33/Lt, whereas on petrol it is Rs. 19.48/Lt. Similarly, the VAT charged by Tamil Nadu government on diesel is 25%, while it is 34% on petrol.
Also Check Diesel Price in NearBy Cities of Tamil Nadu
|Diesel Price In Chennai||Diesel Price In Coimbatore||Diesel Price In Madurai|
|Diesel Price In Salem||Diesel Price In Trichy||Diesel Price In Erode|
|Diesel Price In Tirunelveli||Diesel Price In Vellore||Diesel Price In Tuticorin|
*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.