Diesel Price in Tirunelveli
The diesel price is changing each day in Tirunelveli. The publicly-owned fuel retailers such as Indian Oil (IOL), Hindustan Petroleum (HPCL) and Bharat Petroleum (BPCL) in Tirunelveli, a city in the Indian state of Tamil Nadu, will declare the new fuel price regularly. Consumers have to check daily prices before buying. Even minor variations in fuel rates will impact the billing amount. Let’s assume the petrol rate in Tirunelveli today has slid by 10 paise a litre, the billing amount will decrease by Rs.10 if you are buying 100 litres of diesel.
The diesel price today stands at Rs.66.69 a litre in the city. This price consists of both forms of taxes: 1) the central tax, which is levied at Rs.15.33 a litre; and the Value-added Tax (VAT), which is levied by the State Government of Tamil Nadu. Both forms of taxes will vary from time to time. The excised duty has been reduced twice by the Central Government since October 2017. The State Government of Tamil Nadu has not lowered the local tax on diesel like Maharashtra, Uttar Pradesh, Madhya Pradesh and Gujarat recently.
|Also Know: Diesel Price in Chennai|
Effect of Dynamic Fuel Pricing on Fuel Prices in Tirunelveli
Today, we have a completely streamlined mechanism for fuel pricing and revision in the country. It is called dynamic fuel pricing. It has been introduced last year to bring to some changes and resolve issues. Unlike before, the fuel prices in Tirunelveli will not be revised twice a month. Instead, it will happen regularly considering the dollar-rupee ratio and crude oil costs. The newly adopted practice gives the Indian fuel retailing sector a competitive edge. In other words, the Indian fuel retailing sector can be aligned to global markets.
In Tirunelveli, the publicly-held oil selling companies retain the ownership of more than 94% of diesel stations. Only 10% of diesel stations are automated. The fully automated diesel stations have an opportunity to update the fuel prices in Tirunelveli without requiring human interventions. On the other hand, the non-automated stations will do it manually. Once the revision is done at 06:00 a.m., the oil marketing corporations will upload the reviewed price.
Characteristics of Dynamic Fuel Pricing
- The movements in crude oil prices and the currency conversion ratio are quickly transmitted to fuel users in the city of Tirunelveli.
- The management of inventory cannot be a problem for fuel companies. So, the fuel users will not face stock-related issues.
- Dynamic fuel pricing helps the fuel retailers to probe cash receipts and cash payments. It will eradicate big variations in fuel prices.
- The biggest benefit of this system is that it enables the OMCs to minimize the capital required to manage regular business activities.
Options to Trace Today’s Diesel Price in Tirunelveli
Indian Oil Company: Indian Oil Company provides fuel consumers with an opportunity to get the latest diesel price in Tirunelveli through SMS services. Consumers require sending an SMS to 9224992249. They can also visit the website, which is iocl.com. The company also offers a mobile application called Fuel@IOC.
BPCL: Bharat Petroleum Corporation Limited also provides an SMS facility. Fuel consumers just need to send an SMS to 9223112222. The mobile application provided by this company is called SmartDrive.
Assessment of Diesel Price in Tirunelveli
Diesel price in Tirunelveli = Crude oil costs + excise duty + VAT + OMC overheads + dealer commission
Crude Oil Cost: Diesel is extracted from crude oil. In India, crude oil is bought from oil exporting nations. The price of unrefined oil is remitted in terms of dollars. In March 2018, the price of a barrel of unrefined oil has jumped to $65. Further, it will be converted into Indian rupees.
Excise Duty: The excise duty on diesel per litre has been revised to Rs.15.33 a litre. It is commonly levied across the states. In November 2014, the excise duty on diesel was Rs.3.46 a litre. After three years, it increased to Rs.17.33 a litre. Further, the Central Government reduced it to Rs.15.33 a litre in the month of February 2018.
VAT: The complete full form of the VAT is the Value-added Tax. It changes from state to state. In Tamil Nadu, the VAT is 30%. The State Government of Tamil Nadu retains the right to change the VAT on fuels whenever required.
OMC Costs: OMCs are a primary stakeholder in the fuel sector. The imported crude oil goes through a complex process. OMCs incur costs at each stage of production. The total amount of OMC expenses is included in the final diesel price in Tirunelveli. According to computations, OMCs spend Rs.8 a litre on diesel.
Why are the factors affecting Diesel Rates in Tirunelveli?
This is an important section of this article. The factors, which affect fuel prices in Tirunelveli, can be clubbed into two categories: 1) internal factors and 2) external factors. Internal elements include the central taxes and the state taxes. If the state and central governments make any modifications in the existing tax framework, OMCs have to reset the diesel rate in Tirunelveli accordingly. Conversely, external elements include the INR-USD exchange value, the supply of crude oil in international markets, the demand for crude oil in overseas markets, the political stabilities or instabilities in oil-producing countries, etc. These factors impact the fuel prices in Tirunelveli in the end.
GST and Current Diesel Rate in Tirunelveli
Has the GST been implemented on diesel? The GST has not been levied on diesel and petrol as of now. It covers all categories of services and products, which are sold by merchandisers in India. The GST is indirectly paid to the government by consumers. It came into existence in 2017. The GST Council has kept diesel outside the GST with an objective to assure that neither the Central Government nor the state governments will lose the earnings. According to analysts, the current diesel price in Tirunelveli is expected to decrease by Rs.15-20 a litre if the GST Council Members levy the GST on the fuel. It is a tough call from the stance of the government.
*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.