Diesel Price in Thane
Diesel is one of the fuels that offers a huge array of efficiency, performance and energy compactness compared to other fuels. From transportation to construction and industrial production, diesel is used almost in all major industries.
Thane, the metropolitan city in the Indian state of Maharashtra, just like its neighbouring city Mumbai, consumes a large amount of diesel with the number of diesel-run vehicles increasing every year. Further, due to the steady growth of industries and construction activities, the demand for the fossil fuel is high in the city.
|Also Know: Petrol Price In Thane|
As a regular consumer of diesel, somebody like you from Thane would like to know how the diesel price in the city is fixed, various components involved in diesel pricing, different factors that impact diesel rate on a daily basis, etc. The following information will help you understand all such components.
Daily Revision of Diesel Prices in Thane
Many of you might be wondering why diesel prices in Thane are being revised every day. Well, there is a reason behind it. Earlier, before the implementation of daily price revision, diesel prices in India were revised once in every 15 days. There were two revisions every month, once on the 1st of every month and next on 15th of the same month. The average crude oil price in the international market in the previous 15 days was considered to revise the price. The fortnightly revision led to sharp increase or decline in diesel prices, creating dismay among oil companies, fuel dealers and even end users.
To avoid such a situation and to bring more transparency in diesel pricing in India, the government instructed Indian oil marketing companies (OMCs) to implement dynamic fuel pricing for all auto fuels across the country starting June 2017.
Dynamic fuel pricing model is one of the popular fuel pricing mechanisms followed in many developed countries such as United States, Australia, Japan, Russia, Germany and many European countries.
Using the pricing model, OMCs would revise fuel prices across the country every day by 6 a.m. Any rise or decline in international oil price will hence be transferred to the end user immediately through dynamic pricing model.
The new pricing system will make consumers more aligned to market dynamics, may rein in speculative market forces, bring more transparency in petrol pricing, minimises the impact on the working capital of OMCs and fuel dealers, and has the potential to attract more private players in the fuel market which is dominated by state-owned companies. Further, it prevents government’s intervention in fuel pricing, thus eliminates political pressure.
Diesel prices in Thane are hence being revised on a daily basis. The OMCs will revise the price every day based on previous day’s crude oil price and currency exchange rate. The same will be updated at all the petrol stations across Thane. While the stations equipped with automatic fuel stations will get an auto update of the price, for non-equipped stations, the price will be updated manually every day.
How are Diesel Prices in Thane Calculated?
Unlike regular products, diesel never comes with an MRP. The reasons - there are various components involved in pricing every litre of diesel. Further, all those components will not be included by a single manufacturer, as the fossil fuel moves from one stage to another while getting exposed to various processes, which results in additional charges being added at every new level. Let’s know in detail how diesel is priced in Thane or in any other city in India.
The cost of diesel in Thane is computed by adding the cost price of crude oil, the cost of refining crude oil into diesel, the tax imposed on diesel by the state and central governments, the commission paid to dealers for supplying diesel from refinery centres, and pollution cess.
Factors Affecting Diesel Prices in Thane
The retail selling price (RSP) of diesel in Thane is primarily impacted by crude oil price in the international market, the currency exchange rate, and the tax component. On the other hand, the price of crude oil is affected by seasonal variations, weather reports, global demands, global political moves, demand and supplies, and the currency conversion ratio.
The cost of diesel will increase if crude oil price in international market increases, Indian rupee declines against the US dollar, increase in state and central government taxes on diesel.
On the other hand, the cost of diesel will decrease if the global fuel price reduces, Indian rupee strengthens against the base currency and when there is a downward revision of state or central government duty on diesel.
The secondary factors that impact diesel price in Thane are the OMC’s profit margins and petrol dealers commission.
The state-owned oil marketing companies (OMCs) namely, Indian Oil Corporation (IOCL), Hindustan Petroleum (HP) and Bharat Petroleum (BP), control the downstream oil market in India, which includes refining, processing and purifying of crude oil. The companies conduct the refining and distribution activities hence would charge marketing and distribution costs and profit margins to the cost price of diesel before selling it to the petrol pump dealers.
Petrol pump dealers purchase diesel from the OMCs. They then add their commission, which factors in employee minimum wage, to every litre of diesel sold at their station. The dealers commission is typically decided by the OMCs, who would revise the same once every year.
GST Impact Diesel Price in Thane
Goods and Services Tax (GST) was introduced to replace all indirect tax forms. However, the GST regime does not influence the price of diesel as all petroleum products are kept outside the purview of GST. If GST is applied to petroleum products, their prices are likely to become cheaper for consumers.
Frequently Asked Questions (FAQs) on Diesel Price in Thane
- Why does diesel price in Thane change every day?
- Why are diesel prices in Thane higher compared to diesel prices in other cities?
- Where would I get the cheapest diesel in Thane?
Diesel price in Thane changes every day because of the dynamic fuel pricing model implemented in India in 2017. The new pricing mechanism revises the diesel price in Thane every day to make it align with international crude oil price and the currency exchange rate. The updated price will be updated at all the petrol pumps in Thane at 6 a.m. every day.
An important factor that comprises diesel price in Thane is the value-added tax (VAT) charged by Maharashtra government. As the VAT charged by the state is higher compared to other states such as Bihar, West Bengal, Karnataka, etc., diesel price in Thane is slightly higher compared to other cities and states.
Diesel price across the city of Thane remains the same except for a few minute differences. The state-owned fuel stations including Indian Oil, Hindustan Petroleum, and Bharat Petroleum offer best diesel price in Thane compared to private counterparts like Shell and Essar. Among the public sector players, Indian Oil offers the cheapest diesel price in Thane, whereas BPCL offers the highest.
Also Check Diesel Price in NearBy Cities of Thane
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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.