Petrol Price in Thanjavur
Thanjavur or Tanjore is a city in Tamil Nadu and boasts of a fertile land that is also famous for its art, culture and architecture. Located in the Cauvery Delta, the city has become important for its agricultural cultivation. Apart from agriculture, the tourism industry contributes to the economy of Thanjavur.
Petrol in the city is offered by state-owned oil companies such as the Indian Oil, Bharat Petroleum, and Hindustan Petroleum. These oil companies operate more than 90% of fuel stations in Thanjavur. Petrol prices are dynamic in nature and are influenced by several important factors which are external and internal in characteristics.
Petrol prices in Thanjavur and in across other cities are revised on a daily basis. With the prices changing every day, which either increases or decreases, it’s essential we understand what components in the petrol price affect the change. Let’s review each of these factors and how they impact the fuel price in Thanjavur.
Factors Affecting Petrol Prices in Thanjavur
As mentioned, the factors are external and internal in nature. While global crude oil prices and the exchange rate of the US dollar are external, internal factors include taxes, profit margins, operational costs, and dealer commision.
- Global Crude Oil Prices: Oil-Marketing Companies (OMCs) purchase nearly 80% of petrol in crude form, making it one of the biggest commodity imported by India. This makes petrol an expensive product to purchase. The global crude oil price is volatile and is influenced by several factors such as production cuts, shortage in supply, high demand and geopolitical tensions. Any changes in these factors lead to the revision in the crude oil price and inversely on the petrol price.
- US Dollar Exchange Rate: The other factor which determines the petrol price is the US dollar exchange rate. Since trading of crude oil happens in dollars, any fluctuation i.e. increase or decrease in rate influences the power to purchase crude oil in the international market. This, in turn, affects the petrol price in Thanjavur.
- Tax on Petrol in Thanjavur: Petrol in Thanjavur includes taxes levied by the Centre and the State. While the Centre charges excise duty of Rs.19.48 per litre, Tamil Nadu implies Value Added Tax (VAT) at 32.06%. If and when the tax rate is revised, the petrol price in Thanjavur rises or falls. Taxes on fuel is the biggest component apart from the global crude oil price.
- Operational Costs & Dealer Commision: Oil companies purchase crude oil from the global market, refine, transport it from oil-producing countries and finally transport petrol to dealers or petrol pump owners across the country. For these services, the petrol price includes profit margins of OMCs, other operational costs and commission to the dealer.
Why are Petrol Prices Revised Daily?
Petrol prices in India or Thanjavur are revised on a daily basis. The previous day’s crude oil price and the US dollar exchange rate is considered before petrol is sold in the Retail Selling Price (RSP). This method is called the ‘dynamic fuel pricing’ mechanism, hence, any changes in the global crude oil price are passed on to the end consumer.
Until 16 June 2017, petrol prices were revised every fortnight by including the average of crude oil prices for the last fortnight and the exchange rate of the US dollar. However, oil companies had to wait a fortnight before any reduction or increase in crude oil price can be passed on to the customer. With the new pricing mechanism, petrol prices are dynamic in nature and are revised daily in Thanjavur.
Calculation of the Petrol Price in Thanjavur
Now that we understand why petrol prices are revised on a daily basis, let us break down the petrol price in Thanjavur 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.19.68/Ltr|
|Total||Retail selling price of petrol in Thanjavur||Rs.81.09/Ltr|
How to get the Latest Petrol Price in Thanjavur?
With petrol prices changing every day, it might be a challenge to know the current petrol price in a city. However, oil companies have developed innovative methods to track the petrol price in Thanjavur and in cities across the country.
- Mobile Apps: Oil companies have launched smartphone mobile apps to track the current petrol price in a city such as Thanjavur. While India’s largest oil retailer Indian Oil has launched the ‘Fuel@IOC’ app, Bharat Petroleum has the ‘SmartDrive’ app, while Hindustan Petroleum has launched ‘MY HPCL’ app to track the petrol price of a city.
SMS Service: OMCs offer services through SMS as well. The below process will help you get the current petrol price.
- Indian Oil: SMS RSP
Dealer Code to 9224992249.
- Hindustan Petroleum: SMS HPPRICE
Dealer code to 9222201122.
- Bharat Petroleum: SMS RSP
Dealer code to 9223112222.
- Indian Oil: SMS RSP
- Online Information: Consumers can visit the respective OMCs website where fuel prices are updated on a daily basis.
Petrol Vs. Diesel Price in Thanjavur
In India, petrol prices are higher compared to diesel prices. Diesel is utilised extensively by public transportation system and commercial vehicles which aid the economy of the city. Additionally, taxes on petrol are higher over diesel taxes. While the excise duty on petrol is Rs.19.48 per litre, diesel attracts Rs.15.33 per litre. The VAT levied by Tamil Nadu on petrol is 32.06% and diesel is charged at 24%, making diesel cheaper than petrol.
Why is GST not Applicable on Petrol in Thanjavur?
The new taxation regime of Goods and Service Tax (GST) is applicable on all trading of commodities and services; however, petroleum products have been exempted from the GST. Since the current taxes - excise duty and local sales tax or VAT - are higher compared to the highest tax slab of the GST, which is 28%, the government’s revenue earnings will take a hit. By removing the exemption of petrol from the GST, the retail selling price of petrol will significantly reduce.
*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.