Petrol Prices in Bhubaneswar
Bhubaneswar is the capital city of Odisha. It is the largest city with a population over 1.73 million. Like other prime cities in India, the number of motorists in Bhubaneswar is growing at a rapid rate. This is the reason why the consumption of petrol in the city is huge. Petrol is not domestically produced. It is derived from crude oil, which is an international commodity.
Bhubaneswar has a good number of petrol bunks owned by Indian Oil, Hindustan Petroleum and Bharat Petroleum. The petrol rates offered by these three companies is almost the same. There can be a minute difference because of the brand and transportation costs. It is the state VAT that makes the petrol price to differ from one city to another.
How are Petrol Prices in Bhubaneswar Revised?
India joins the United States of America and Australia that revise fuel prices on a daily basis. Revising fuel rates on a daily basis is called dynamic fuel pricing or the daily revision. As per this model, all petrol bunks whether automated or non-automated will revise petrol rates in Bhubaneswar every day. The revision is done at 06:00 a.m. manually by non-automated bunks. The revision is automated in case of automated bunks.
After the daily fuel revision came into effect on 16 June 2017, petrol prices in the city have slashed considerably. Dynamic fuel pricing has a direct impact on the financial health of any state since it influences consumers. Since 16 June 2016, petrol prices have diminished and it is the fuel consumers who are benefiting the most out of this move. This will in turn help to build a positive impact on some means of transportation and worldwide trade.
Benefits of Dynamic Fuel Pricing
Like the previous revision system, dynamic fuel pricing is based on the currency exchange rate and crude oil prices. Any variations in these two determinants can be easily and instantly transmitted to end petrol consumers. In other words, consumers are aligned to market dynamics. Fuel pricing is 100% transparent under the daily revision model that also allows dealers to adopt the best inventory management practices.
The price revision for any day becomes effective from 06:00 a.m. after 16 June 2017. Oil marketing companies will keep informed dealers about the next day’s rate at 08:00 p.m. Petrol consumers in Bhubaneswar can access the revised prices of petrol either through mobile applications created by all oil marketing companies or through online portals. Customers can also avail the benefit of customer care services offered by oil marketing entities.
Trends in Petrol Costs in Bhubaneswar
The petrol rate in the city indicated a decreasing trend during the first three weeks of the daily revision. It started growing marginally later on. Between July 2017 and August 2017, petrol rates witnessed a growing trend. In October 2017, petrol was sold at an average price of Rs.67.50 in Bhubaneswar, the capital city of Odisha. Petrol was priced at Rs.68.15 per litre on the first day of September 2017 and at Rs.69.53 per litre on the last day of the month.
In August 2017, the petrol rates in the city have grown by 5.44%. The highest price in the month was Rs.68.24 and the lowest price was Rs.64.53. In July 2017, the lowest price was Rs.62.39 and the highest price was Rs.64.56. In June 2017, the petrol rate in Bhubaneswar has fallen by 5.99%. The lowest price in the month was Rs.63.27 and the highest price was Rs.67.06. In May 2017, the highest price was Rs.68.19 and the lowest price was Rs.65.44.
Average Price Comparison
Let’s take the average price of petrol in Mumbai, New Delhi, Bangalore, Chennai and Bhubaneswar. The average petrol rate in the capital city of Odisha was Rs.67.50 in October 2017. In New Delhi, it was Rs.68. In Mumbai, petrol was sold at an average rate of Rs.75.70. In Chennai, it was Rs.71.20. In Bangalore, it was Rs.69.70. The petrol price in Bhubaneswar is less compared to all these prime Indian cities. As on 4 October 2017, the state VAT imposed on petrol and diesel was 26%.
How are Petrol Prices in Bhubaneswar Calculated?
The retail selling price of petrol includes the following cost elements:
Cost of crude oil: The price paid by Indian oil marketing companies to purchase crude oil is called the cost of crude oil. Freight charges are also included in the cost price of crude oil, which is remitted to overseas oil marketing companies.
Refinery transfer price (RTP): The imported unrefined oil will be shifted to refinery stations for further processing. The cost charged by refineries to convert crude oil into petrol is called refinery transfer price. It is expected to remain constant for some period of time.
Taxes: The retail selling price includes the state VAT imposed on petrol by the local and central governments. Petrol is taxed at 26% in Odisha. The central excise duty on petrol as on 4 October 2017 was Rs.19.48 per litre.
Other cost elements in the price structure of petrol include the profit margin of oil marketing companies, entry taxes and operational expenses incurred by oil marketing companies, the commission charged by dealers, marketing expenses, transportation costs and pollution cess.
Influences of Petrol Prices in Bhubaneswar
Petrol prices in Bhubaneswar are affected by the exchange rate, the cost of crude oil and the tax levied on petrol. The exchange rate of the INR against the USD makes a big difference to the cost price of crude oil. The Reserve Bank of India determines the exchange rate, which is impacted by interest rates, inflation rates and the overall debt of a nation. Similarly, the cost of crude oil is affected by seasonal fluctuations, weather conditions and global political events.
The cost of crude oil will marginally increase when the Indian currency depreciates against the USD. As a result, the petrol rate goes up. When the INR appreciates against the USD, the petrol rate diminishes. Another important factor affecting petrol rates in Bhubaneswar is the state VAT, which was 26% in Odisha as on 4 October 2017. The excise duty levied by the central government also impacts. Recently, it was revised on 4 October 2017.
How does GST Impact Petrol Costs in Bhubaneswar?
Currently, all goods and services are taxed under the regime of GST that was introduced in India on 1 July 2017. GST has been imposed on all kinds of goods and services except five petroleum products including petrol. All petrol consumers in the city continue to pay the tax under the current slab. The highest rate fixed by the GST Council is 28%. The current petrol rate in Bhubaneswar will dampen by 20-30% even if GST is imposed on petrol at the highest rate. Moreover, the central and state governments stand to lose the major source of revenue.
*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.
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