Petrol Price in Trichy Today

Therefore, all petrol dealers in Trichy have begun revising fuel rates (diesel and petrol) on a daily basis in sync with the currency conversion rate (INR/USD) and worldwide crude oil prices. Currencies are traded in the foreign exchange market (Forex market), which is highly volatile in nature. The benefit of using dynamic fuel pricing is that the regular variations in the INR/USD rate and crude oil prices can be instantly transmitted to end customers.

The price revision is done at 06:00 a.m. every day. The next day's fuel price will be informed to dealers at

08:00 p.m. every day. Since the daily revision encourages the automation drive, the daily revision is automatically done in automated bunks. All non-automated petrol stations will manually revise fuel rates. Petrol consumers from Trichy can easily trace the latest petrol price as oil marketing companies such as Indian Oil, Bharat Petroleum and Hindustan Petroleum have created mobile applications.

Other Benefits of Dynamic Fuel pricing

The following are the additional benefits of the daily revision mechanism:

1. Bunk owners can deploy the industry best inventory management principles.
2. Bunk owners can efficiently and effectively manage their working capital.
3. The Indian fuel retailing sector can be aligned to global markets.

Petrol Price Comparison (per litre)

Let's consider the five prime cities in India to make a comparative study. On 6 November 2017, the petrol price in Bangalore, which is the capital city of Karnataka, was Rs.70.77 after the daily revision. In Mumbai, the capital city of Maharashtra, the fuel was priced at Rs.76.77, and in Kolkata, the capital city of West Bengal, the fuel was sold at Rs.72.44. In Chennai, the capital city of Tamil Nadu, the fuel price was Rs.72.23.

Since the Value-added Tax (VAT) Structure varies from state to state, the fuel is priced differently in different cities. As on 4 October 2017, the state VAT imposed on petrol in Tamil Nadu was 34%. In Maharashtra, it was 47.94%. In Karnataka, it was 30%. Similarly, the VAT levied on petrol was 26.87% in West Bengal. The higher the state VAT, the higher will be the petrol price. The lower the state VAT, the lower will be the petrol price.

How are Petrol Prices in Trichy Computed?

The price paid by consumers is the final price that includes the following elements:

Cost of crude oil: Petrol is a derivative of crude oil, which is exported by foreign oil companies. Crude oil is transacted in overseas markets since it is an international commodity. The price should be paid in US dollars. The cost of crude oil incurred by Indian oil marketing companies is influenced by weather conditions, seasonal variations, the demand and supply for oil and the global economics. As on 6 November 2017, the price of WTI Crude was $55.95 per barrel.

Taxes: Almost 50% of the retail selling price is formed by taxes. Petrol is taxed at the state and central levels. The retail selling price includes the central excise duty of Rs.19.48 per litre and the 34% state VAT levied by the state government.

OMC expenses: All types of expenses incurred by oil marketing companies (OMCs) are included in the final price. The expenses incurred by OMCs include marketing costs, refinery transfer price, operational costs, the profit margin of OMCs, freight charges and entry taxes. Other components include the commission charged by dealers and pollution cess.

Factors affecting Petrol Price in Trichy

The cost of crude oil, the exchange rate of INR/USD and taxes will affect the petrol prices in Trichy. On a contractual basis, crude oil is imported. So, variations in the exchange rate will impact crude oil prices that in turn affect petrol rates. The central excise duty was reduced to Rs.19.48 per litre on 3 November 2017. As a result, the fuel price was down by over Rs.2.00 per litre in Trichy. It means that ups and downs in the taxes collected by the state and central governments will influence the fuel price.

Impact of GST on Petrol Costs in Trichy

In India, the Goods and Services Tax (GST) was introduced in July 2017. It is a complete, unified tax system applicable to various types of commodities and services. Unlike other products, petrol has been exempted from GST. Therefore, GST rates have no impact on petrol prices. The fuel price will fall by at least 30-35% if GST is imposed on the fuel. The implementation of GST affects the revenue of the government. The complete oil and natural gas industry does not fall under the purview of GST.