Petrol Price in Hosur
Hosur is a commercial city in the Indian state of Tamil Nadu. The city has produced a huge number of petrol users over the last decade. Do you think the petrol price in Hosur is reliant on domestic factors such as demand and supply? It is not! Petrol is extracted from unrefined oil, which is borrowed from oil-producing economies. Therefore, the petrol rate in Hosur is not interlinked to the domestic supply and demand conditions like other commodities. It is offered each day considering the previous day’s exchange rate and crude oil prices. Today’s petrol price in Hosur, i.e., 6 March 2018, is Rs.76.46 per litre. It consists of state and central levies and expenses disbursed by oil marketing companies.
Analysis of Petrol Prices in Hosur
During the first week of March 2018, petrol in the city traded with an average price of Rs.76.20 per litre. The fuel was sold at Rs.75.58 per litre on the first day of March 2018. Today, it climbed to Rs.76.46 per litre. Within a span of seven days, the fuel price accelerated by 88 paise per litre. Let’s now look at historical prices. On 2 April 2017, the fuel rate was Rs.70.56 per litre and further increased to Rs.72.48 per litre during the first week of May 2017. When reviewed on 1 June 2017 and 1 July 2017, the fuel rates were Rs.71.22 per litre and Rs.66.67 per litre respectively.
The fuel rate in the city further increased to Rs.68.96 per litre on the opening day of August 2017. It then climbed to Rs.73.11 per litre on the opening day of September 2017. The fuel traded at Rs.74.72 per litre on the first day of October 2017. As the Central Government reduced the excise duty by Rs.2 per litre on 3 October 2017, the fuel rate fell to Rs.72.97 per litre on the first day of November 2017. On 1 December 2017, it increased to Rs.73.07 per litre. Over the next month, it had been up by 80 paise. During the first week of February 2018, petrol in Hosur was sold at Rs.77.17 per litre.
Central Taxes and VAT in Hosur
Petrol users pay two types of taxes on petrol: 1) the central tax and 2) the state tax. In the Union Budget 2018-2019, the central tax has been revised to Rs.19.48 on petrol per litre. The lately announced road cess is also included in the central tax. It is charged commonly in all Indian states. The Government of Tamil Nadu charges the VAT on petrol at 34%. The state tax in Tamil Nadu is high compared to neighboring states such as Karnataka and Goa.
Revision of Petrol Price in Hosur
The fortnightly-based revision has now been replaced by dynamic fuel pricing or the daily revision system. Instead of revising fuel rates twice a month, oil marketing entities will revise each day under this system. How is the revision done? The revision is done by considering the closing price of unrefined oil and the value of the INR against the dollar. After 06:00 a.m. each day, oil marketing entities are necessitated to offer the new price for fuel consumers through online and offline means. They have been following the same practice since June 2017.
All stakeholders of the fuel retailing sector are benefited from the daily revision mechanism, including OMCs, petrol consumers in Hosur, dealers and the Central Government. Working capital can be efficiently monitored by OMCs, which also can handle stock levels better. They can ensure the steady supply of petrol to customers. Downs and ups shall be rapidly transmitted to fuel buyers in the city. Unlike the earlier fortnightly-based revision, there is no waiting period of 15 days to get revised fuel prices.
Ways to Track Today’s Fuel Price in Hosur
If you are a petrol user in Hosur, track the latest petrol price using mobile applications. This option holds appropriate for smartphone users. Mobile applications are offered by Hindustan Petroleum, Bharat Petroleum and Indian Oil. If you are not using smartphones, consider the facility of SMS services. You just need to send an SMS requesting the current petrol price in Hosur. Or else, consider visiting the website of either Bharat Petroleum or Indian Oil or Hindustan Petroleum to get the revised fuel price in the city.
Computation of Today’s Petrol Rate in Hosur
Petrol price in Hosur today = Crude oil rates + OMC expenses + central tax + state tax + commission + pollution cess + profit margin of OMCs
- Cost of Crude Oil = The cost of Brent crude oil was $65.57 per barrel as of 6 March 2017. The exchange rate of the USD against the INR was 64.88. Using this information, we can assess the market price of crude oil per litre, which is Rs.26.75.
- OMC Expenses = Oil marketing companies pay the refinery transfer price, operational overheads, entry levies, freights etc. It will be Rs.8 per litre according to calculations.
- Central Tax: The Central Government revised the central tax in the Union Budget 2018-2019 that has been presented during the first week of February 2018. A central tax of Rs.19.48 is charged on petrol per litre. It will be continually monitored by the Central Government.
- VAT: The State Government of Tamil Nadu imposes the Value-added Tax on petrol at 34%. It is computed on the price, which is quoted to dealers.
- Commission and Pollution cess: Petrol suppliers in Hosur will impose a 7% commission on petrol per litre. The pollution cess on petrol per litre is 25 paise.
Forces affecting Petrol Cost in Hosur
Crude oil prices and the USD/INR conversion rate influence the fuel price a lot. If crude oil rates increase, the fuel price will increase. On the contrary, if crude oil rates fall, then the fuel price will fall. If the USD boosts against the domestic currency, the fuel price will increase. If the domestic currency boosts against the USD, then the fuel rate in Hosur will decline. Domestic influencers include the VAT and the excise duty. When the Central Government increases the excise duty, the fuel price will increase and vice versa. When the VAT increases, the fuel price in Hosur will increase and vice versa.
Effect of GST on Current Petrol Price in Hosur
The present GST taxation system has no effect as far as the petrol rate in Hosur is concerned. Petrol is out of the GST regime currently. The GST Council may consider bringing petrol under GST. But, revising the existing GST rates is the biggest problem for the GST Council. What will happen if GST is charged on petrol? The price of the fuel will fall by 30-40% in Hosur at 28% GST. If the GST Council plans to impose GST on petrol, additional taxes should be levied on petrol to offset the losses for state governments.
*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.