Petrol Price In Solapur Today

Petrol Price in Solapur

Petrol is expensive in all regions of Maharashtra, including Solapur. Petrol price in Mumbai is high compared to that in Solapur because of Value-added Tax. As of today, the Government of Maharashtra levies a VAT of 39.95% in Mumbai, Thane and Navi Mumbai. In other parts of the state, VAT is imposed at 38.93%. Excise duty is levied at Rs.19.43 a litre universally across the state of Maharashtra.

Petrol prices in Solapur, a district headquarter, have crossed their multi-year highs in January 2018. They are influenced by international and domestic elements. Cost of unrefined oil is a global factor and has increased 15-18% over the last 1 year. Due to which, petrol rate in Solapur has jumped to Rs.83.09 a litre during the first week of May 2018.

Trend in Petrol Price in Solapur between January 2018 and March 2018

Within a span of three months, fuel rates in Solar have been reported to be up by Rs.5 a litre. Between January 2018 and March 2018, they were up reasonably as a result of increased crude oil prices and a weakened dollar. In February 2018, there has been a slight drop in fuel prices in Solapur and other regions of Maharashtra. The entire country is expecting a further cut in excise duty. Will the government do? It may! Fuel consumers may also envision a further drop in Value-added Tax, which was declined by Rs.2 a litre in October 2017 by the State Government of Maharashtra.

Dynamic Fuel Pricing – A Fuel Pricing System

Since 16th June 2018, Hindustan Petroleum Corporation Limited, Bharat Petroleum Corporation Limited and Indian Oil Corporation Limited have been resetting fuel prices in the city under dynamic fuel pricing. Before that, the revision of fuel rates used to be done twice a month. The first revision used to occur on 1st and the second revision on 16th. Today, under dynamic fuel pricing, fuel pricing shall be carried every day taking into crude oil rates and the exchange rate.

Will Dynamic Fuel Pricing be Beneficial for Customers?

Yes. It is! Managing stock was tough earlier. This is not the case now. Petrol buyers expect a steady supply, which can be assured. They also expect transparency in fuel price revision. Dynamic fuel pricing assures that the revision of petrol prices or diesel rates is fully free from political influences. Changes in costs of crude oil and the USD/INR rate shall be quickly transmitted to petrol buyers in Solapur. This has been a key and prime feature of the newly launched system.

Will Dynamic Fuel Pricing Benefit OMCs?

OMCs stand for Oil Marketing Companies (OMCs). In India, like mentioned earlier, there are three OMCs that include Indian Oil (IOCL), Hindustan Petroleum (HPCL) and Bharat Petroleum (BPCL). These OMCs are publicly-run and have more than 90% of market share. The introduction of dynamic fuel pricing offers significant benefits to OMCs. They can not only save costs but also the time needed to manage day-to-day business activities. The system also upholds automation drive. For instance, fully mechanised OMCs can revise fuel prices without human interventions.

Assessment of Petrol Price in Solapur

As of 7th May 2018, petrol rate in Solapur stood at Rs.83.09 a litre. This is the Retail Selling Price offered in the city. Now, the concern is, how is the RSP of petrol assessed? Well, the OMCs play a major role as far as the revision of fuel prices is concerned. To arrive at the RSP, they add all types of expenses incurred at each stage. Cost components can be of three types:

• Crude oil cost: This is the biggest cost element. It was estimated to be Rs.28 per litre as of 1st May 2018. It is paid in terms of dollars.
• OMC expenses: Overheads spent by the OMCs include operational costs, entry levies, refinery processing expenses, transportation costs, freight costs and OMC profit margins. They were estimated to be Rs.8.20 on petrol per litre as of 1st May 2018.
• Taxes: Taxes are levied by the state and central governments like mentioned earlier. They are subject to fluctuate from time to time.

Put simply, Retail Selling Price of petrol in Solapur = Crude oil costs + OMC overheads + excise duty + VAT + dealer commission + pollution cess

Factors Impacting Petrol Price in Solapur

Current petrol price in Solapur gets affected by both indigenous and overseas cost aspects. Both excise duty and VAT are indigenous aspects. If there is a hike in excise duty, the OMCs will also increase the price offer. In case there is a drop in excise duty, the price offer will be diminished. Similarly, the OMCs will reset the RSP considering ups and downs in VAT.

Changes in the USD/INR exchange rate are taken into account while determining fuel rates. The impact of the currency translation ratio has been minimal. Petrol price in Solapur is likely to increase if the USD/INR drops. In case the USD/INR appreciates, fuel rates are likely to drop. Being a highly volatile currency pair, the USD/INR changes on a daily basis. Changes are reflected in current fuel prices in Solapur.

Crude oil costs directly impact the appraisal of fuel rates. If they fall, fuel rates will fall. If they increase, fuel rates will also increase. Many factors impact crude oil price per barrel. For instance, oil-producing countries may announce a production cut for maintenance. If they declare a production cut, the production and distribution of unrefined oil will be affected. As a result, retail fuel prices in the domestic market get affected.

GST vs Today’s Petrol Price in Solapur

Goods and Services Tax is a much-needed tax reform in India. It is governed by the GST Council today. The council has set 4 tax slabs: 5%, 12%, 18% and 28%. The highest tax slab set so far is 28% and the lowest tax slab is 5%. Currently, the whole oil and natural gas sector has not been covered under GST. Including petrol under GST shall dampen petrol rates. GST may be levied on petrol by making required changes. The opposition party leaders also have raised concerns over bringing petrol under GST. Finally, the GST Council has to take a decision.

Also Check Petrol Price in NearBy Cities of Solapur

*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.