Petrol Price in Bhilai
The city of Bhilai is a major industrial centre in the state of Chhattisgarh. Bhilai is known for its steel industry especially the government-operated plant built in collaboration with the erstwhile Soviet Union between 1956-61. With a vast road network, the city is aided by the public transportation system, while two-wheelers and four-wheelers add to the vehicular density.
Fast becoming one of the prominent cities in the country, Bhilai’s fuel consumption is on the rise and petrol has become an essential commodity. With petrol prices revised daily, it’s essential to understand several aspects of petrol pricing in Bhilai.
Just like other cities, nearly 90% of the fuel stations are owned by the state-run oil companies including Indian Oil, Bharat Petroleum and Hindustan Petroleum. The petrol price in Bhilai is dynamic and changes everyday due to several elements which influence the change in fuel rates in Bhilai.
What Factors Affect the Price of Petrol in Bhilai?
The latest petrol price in Bhilai or other cities is impacted by international and domestic factors. India imports nearly 80% of crude or unrefined oil from oil-producing countries. The crude oil is purchased through US dollars which form the two main international factors. Domestic factors include taxes levied by the Centre and the respective State and other operational costs involved in selling fuel in the country.
- International Crude Oil Price: The global crude oil price is the base price of the petrol rate. Any changes in crude oil prices impact the petrol rate in India. The change in the price for a barrel of crude oil is attributed to a steep hike in demand, production cuts or geopolitical tensions in the world. Besides, trading of crude oil happens in US dollars, hence any revision in the exchange rate affects the petrol price since India purchases crude oil in dollars. Any hike in demand, countries such as India and China have high demand, increases the crude oil price in the global market and vice versa. Likewise, if there is a shortage of supply the rate of crude oil appreciates.
- Exchange Rate of the US Dollar: As for the US dollar, fluctuations in the value has a direct impact on the petrol price. If the US dollar appreciates in value, the value to purchase a barrel of crude oil increases and this influences the Retail Selling Price (RSP) of petrol in the country. Also, any depreciation of the dollar might bring the prices down. The US dollar value changes due to the trend in demand and supply for a particular currency in a country.
- Tax on Petrol: All trading of goods and services attract tax in India. Fuel such as petrol and diesel are levied taxes by the Centre and the State. While the former levies the excise duty, the latter charge Value Added Tax (VAT) on the sale of petrol in the country. The excise duty is similar across the country and is currently charged at Rs.19.48 for a litre of petrol, while the VAT by the state of Chhattisgarh is 27.02%. Therefore, any change in the tax rate leads to the revision in petrol prices. Taxes are the biggest component of the pricing structure of petrol in India.
- Profit Margin & Dealer Commission: Apart from the global crude oil price paid by oil companies, they transport the unrefined oil through the sea and charge ocean freight as one of the components in the petrol pricing. Once imported, the crude oil attracts entry tax, refinery processing, landing costs and other operational costs along with the profit margins. Oil companies include all of these costs before adding the dealer commission. Dealer commission is the profit to dealers or fuel station owners for storing and dispensing petrol to end consumers.
Calculation of the Petrol Price in Bhilai
Now that we know the factors which influence the pricing of petrol, let’s break down the components with an example of the petrol price in Bhilai on 3 June 2018.
|1||Global Crude Oil Price + Freight Charges||$78.30 per barrel = Rs.32.98/Litre (considering $1=66.96 and 1 barrel oil = 159 litres)|
|2||Profit margin of Oil Companies, transportation, refining, and operational costs||Rs.5.32/Ltr|
|3||Central Excise Duty + Road Cess||Rs.19.48/Ltr|
|5||Value Added Tax (VAT)||Rs.14.16/Ltr|
|Total||Retail selling price of petrol in Bhilai||Rs.75.57/Ltr|
Why do the Petrol Price Change Daily in Bhilai?
Petrol prices are revised under the ‘dynamic fuel pricing’ mechanism where prices for a litre of petrol is fixed daily and updated at 6 a.m. every day. Prior to this method of pricing, India used to change petrol prices every fortnight by including the average rate of crude oil and the exchange rate of the US dollar. However, any sudden hike in crude oil prices did not translate to the current petrol price in a city. Therefore, the Indian government introduced the new pricing mechanism where the current petrol price is in tandem with the latest crude oil prices.
How Can I Find the Current Petrol Price in Bhilai?
Since petrol prices are revised daily, it’s quite challenging to know the current petrol rate in a city. To make it easier for consumers to track the current petrol price, oil companies offer several methods to track the price. Below are the methods to get the current petrol price in Bhilai.
- Smartphone Apps: Indian Oil has launched the ‘Fuel@IOC’ app to track the latest petrol price, BPCL has the ‘SmartDrive’ app, while HPCL offer services through ‘MY HPCL’ app.
SMS Service: For those looking to take advantage of the SMS service, one can follow the below process to get the current petrol price.
- Indian Oil: SMS RSP
Dealer Code to 9224992249.
- Bharat Petroleum: SMS RSP
Dealer code to 9223112222.
- Hindustan Petroleum: SMS HPPRICE
Dealer code to 9222201122.
- Indian Oil: SMS RSP
- Online Portal: Consumers can visit the respective oil company’s website to track the latest petrol price in their city.
Excise Duty & VAT Vs. GST on Petrol
Petroleum products such as petrol and diesel attract taxes from both the Centre and the State as these are exempted from the Goods and Service Tax (GST). By bringing petrol under the GST, the revenue generated by the government will reduce significantly. This is due to the taxes levied currently on petrol is much higher compared to the highest tax slab of the GST. However, by bringing petrol under the GST will indeed reduce the petrol price paid by the consumer.
*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.