Today's Petrol Price in Madhya Pradesh

Madhya Pradesh is one of the most commonly known Agrarian states in India. Approximately, 74% of its population is entirely dependent on agriculture and farming. However, it is one of the fast-growing Indian states.

Until 2003, the state was regarded as India's "sickest economies" during the tenure of Chief Minister - Digvijay Singh. But after the year 2005, the state saw consistent growth and reached to India's best-performing states in GDP growth.

Factors That Affect Petrol Price In Madhya Pradesh

It will not be an exaggeration to state that fuel rates in India affect an Indian resident either indirectly or directly. Since the deregulation, the fuel prices change on a fortnight basis and this involves various factors.

Although a major population of India keeps track of the prices of commodities like petrol and diesel on a daily basis, a lot are not that aware or familiar about their pricing structure or elements that make up their retail prices. Considering this, here's exactly what you need to read:

1. The Price Of The Crude Oil

Petrol's RSP (Retail Selling Price) is decided based on various factors. However, an important key component is "crude oil." It is one of the vital raw materials to extract fuel. Since 75% of the crude oil requirements in India relies upon import, it is refined and transported.

This, of course, comprises of cost charges, freight charges, and refinery charges. All these together give the price of the crude oil, which is termed as RTP (Refinery Transfer Price). In short, this is the cost that Indian OMCs (Oil Marketing Companies) like HPCL (Hindustan Petroleum Corporation Limited), IOCL (Indian Oil Corporation Limited), and BPCL (Bharat Petroleum Corporation Limited) pay to the refineries that they import from. The Oil Marketing Companies retain some amount of margin before selling it to the dealers.

2. Taxes

Though there are various types of taxes involved for fuel, they are broadly classified into two types:

1. State Value Added Tax (VAT)
2. Central Excise Duty - the Central Government imposes this

The above two tax types are added to the fuel rates that are set for the dealers. However, the VAT varies from one state to the other and keeps revising.

All these together make up the RSP (Retail Selling Price) of the fuel. However, there may be variations based on the region and the pumps owned by different Oil Marketing Companies. These minor variations in prices are due to the differences in dealer commissions and other profit margins.

3. Demand

As a rule of thumb, an increase in demand directly affects a commodity's price. As far as the Asian continent is considered, and residing in a developing nation like India, fuel demand is always high. However, there are times when this demand gets even higher. Such are the times when the petrol prices also incline.

1. On 1 April, the price of petrol in Madhya Pradesh was Rs.108.63 for a litre. Petrol prices remained the same throughout the month in the state. 
2. In May, the price for a litre of petrol in Madhya Pradesh was Rs.108.63. Petrol rates remained the same throughout May in the state. 
3. The prices of petrol in Madhya Pradesh in June remained the same and were Rs.108.63 for a litre. 

Who Controls The Fuel Rates In India?

No one controls the diesel or petrol prices in India. It all comes down to the market performance. Undoubtedly, the state and central taxes play a key role in the overall demand but it does pressurize the prices. Nevertheless, there is no one controlling it directly.

However, this wasn't the case before. Thanks to the recently implemented mechanism called "dynamic fuel pricing system" in India. Earlier, both diesel and petrol prices were controlled via government subsidy. In fact, the fuel subsidies burnt a big hole in the Indian Government's pocket whenever the crude oil rates went high after the Iraq invasion in 2003.

To reduce the subsidy bill of GOI (Government of India), petrol prices were deregulated in the year 2010 and diesel rates in the year 2014. Therefore, the prices are determined based on the market trends and the supply-demand chain.

Overall, the fuel prices in India comprises of the following components:

1. International crude price
2. VAT - Value Added Tax
3. CER - Currency Exchange Rate
4. Excise duty
5. Transportation cost
6. Refinery cost

Before June 16, 2017, the petrol prices in India were updated on a fortnight basis, meaning that based on the market performance of the previous day, the rates were modified on the first and sixteenth day for each month at 8:00 a.m.

However, this not only incurred a lot of losses to the oil marketing companies but also the governments could easily influence or affect them. To prevent all the drawbacks and to bring in better transparency in the system, the mechanism of "dynamic fuel pricing" was implemented.

What Is Dynamic Fuel Pricing?

The concept of Dynamic Fuel Pricing is something that is not only implemented in India but is also a mechanism that most developed countries follow. As per this system, the fuel prices are updated every morning at 6:00 a.m. based on the international and domestic market performances.

How Can Customers Know The Present Petrol Price In Madhya Pradesh?

There are 2 ways to know this information:

1. A petrol buyer can easily download and install a mobile application to learn about the current petrol price based on a location. There are three mobile applications for this, which are SmartDrive, Fuel@IOC, and My HCPCL. These are put up at the app store free of cost by Bharat Petroleum, Indian Oil, and Hindustan Petroleum respectively.
2. Mobile applications might not be ideal for a petrol buyer who does not have a smartphone. However, this doesn't mean he or she cannot know about the current prices. An SMS can be sent to the respective service numbers of BPCL, HPCL, & IOC to receive the latest prices in Madhya Pradesh or any other region.

Does GST Affect The Vadodara's Petrol Prices?

No, GST does not have any kind of influence in the petrol or diesel prices in India because these commodities have not been brought under its influence yet. Moreover, imposing GST (Goods and Service Tax) on fuel will not only lessen the rates by 27-37% but also the government might not be able to handle such big losses. Someday, if this turns out to be a reality, then the revenue of both State Government and Central Government will be heavily affected.

*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.