Petrol Price In Bareilly
There have been a lot of fluctuations in the petrol price in Bareilly and there are multiple factors associated with it. The ups and downs in fuel prices are mainly due to the concept of dynamic pricing. However, this is not the only factor.
To make you understand better about the petrol pricing and the various aspects affecting the overall fuel cost in Bareilly, read the information given below. But before that here is a quick introduction to Bareilly’s economic and industrial growth.
Bareilly is one of the well-known cities in the state of Uttar Pradesh and is located about 252 kilometers from its capital city – Lucknow. Bareilly is the eighth biggest metropolis in U.P (Uttar Pradesh) and the fiftieth biggest city in India.
Ever since India started liberalizing its economy, a city like Bareilly has seen a rapid and immense growth. Most public sectors undertaking this city are Indian Oil Divisional Office, BSNL (Bharat Sanchar Nigam Limited), Indian Oil Aonla Depot, Camphor & Allied Products, IFFCO Aonla, SK Industries, Superior Industries, CAPL (Commercial Automotive Private Limited), etc.
Factors That Affect Petrol Price In Bareilly
Gasoline is mainly sold based on the octane levels, which are usually divided into three grades:
- Premium grade
- Regular grade
The octane levels in gasoline denote its combustion resistance. Therefore, gasoline that has high octane levels is less prone to detonation and pre-ignition. This is also called “engine knocking.” A refiner charges more for gasoline that features a high octane level. On the other hand, the premium gasoline is the most expensive.
During the years 1995-2006, the difference in prices for various gasoline grades was very less for every gallon. However, after 2006, the price difference was greatly increased and today, it is more than what you can imagine.
Besides all these, there are various factors associated with a spurt in the petrol price. In Bareilly, these factors play a key role in the daily fluctuations:
- The cost of the crude oil
- Profit margin
- Refining cost
- Distribution cost
- Marketing cost
The price of a retail pump in Bareilly not only reflect the components that are mentioned above but also the profits of marketers, refiners, retail owners, and distributors.
What Determines The Cost Of The Crude Oil?
When it comes to petrol and diesel, the foremost and most important factor that determines their prices is certainly the current market rate of the crude oil. In fact, it is the biggest factor in determining the gasoline’s retail price. But note that this also varies from one state to the other.
The cost of the crude oil is decided based on the demand and supply chain. The global economic growth plays a key role in the demand. The oil price also frequently increases due to some interruptions in the domestic and international supply of the crude oil.
The OPEC (Organization of the Petroleum Exporting Countries) at times exerts a vital influence on the overall oil price by setting up a limit on the production to its members. From 2000 to 2016, the OPEC countries have produced about 45% of crude oil for the world. These countries sustain most of the spare oil production ability and possess three-fourth of the estimated global crude oil reserves.
The cost of the crude oil is determined by various factors and these are as follows:
- Tax: The tax policies set by the Indian Government, State Government, and the Federal Government contribute to the crude oil’s retail price. Also, the sales tax imposed by the municipal and domestic governments can have significant impacts on the price in certain locations.
- Profits and Refining Cost: Profit margins and the cost to refine crude oil differ seasonally. Another factor that plays a key role is the geographical location because various gasoline formulations are required to lessen the air pollution in various parts of a country. A gasoline ’s characteristics depend completely on the kind of crude oil that is being used and the type of processing method that is available. The price of gasoline is also affected due to the cost of a few other ingredients that go into making it. Say, for example, ethanol.
- Marketing and Distribution: The cost involved in marketing, distribution, and dealership is also a key factor in concluding the retail price of a gasoline. Since a majority of gasoline is being shipped from the respective refineries via pipelines to the concerned terminals, it might be combined with a few other products (like ethanol) in order to meet the specifications of the market and local government.
What Pricing System Is Used In Bareilly?
The fuel retailers that are run by the State Government – Hindustan Petroleum, Bharat Petroleum, and Indian Oil Corporation – once used to revise the petrol rates on the first and sixteenth of each month depending on two important factors:
- International market price
- Currency Exchange Rate (CER)
Since this pricing system involved changing the price on a fortnightly basis, it was called the “fortnight pricing system.” But this had multiple drawbacks and most importantly, no transparency. This is when the concept of “dynamic fuel pricing” was initiated and implemented on June 16, 2017. Based on this mechanism, the retail price of both petrol and diesel are revised every day at 6:00 a.m. IST (Indian Standard Time). The dynamic fuel pricing is not only implemented in Bareilly but also in every region in India.
Does GST Affect The Petrol Prices In Bareilly?
No, GST does not affect the overall petrol price in Bareilly. In fact, petroleum products like unrefined oil, natural gas, diesel, and aviation fuel all have been out of the GST’s influence. Therefore, the oil and gas industry adheres to the current tax system that the Indian Government has imposed. Though GST can be imposed on petrol, it will not only take time but also has to permit the whole sector to utilize the commodities’ tax credits in the distribution network.
*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.