Today's Fuel Prices in India - December 23, 2024

Use the V3Cars Fuel Cost Calculator or apply this formula: Fuel cost = (Distance / Consumption) × Cost per gallon. Fuel cost = (Distance / 100 × Consumption) × Cost per gallon.

Fuel price in India is affected by many factors. Here are some of the key reasons why petrol and diesel prices may be relatively high in the country:

• World Crude Oil Prices: India relies heavily on crude oil imports to meet its domestic oil requirements. Fluctuations in crude oil prices across the world have a direct impact on gasoline prices in India. When international oil prices rise, it increases the cost of importing crude oil, which in turn affects the retail price of fuel.
• Taxes and Duties: Taxes and duties imposed by the central and state governments contribute significantly to the cost of gasoline in India. Central taxes, such as excise duty, and state-level taxes, such as value-added tax (VAT), are levied on gasoline, which increases its retail price. These taxes are subject to change based on government policies and income requirements.
• Currency Exchange Rates: The exchange rate between the Indian Rupee and the US Dollar also affects the determination of gasoline prices. Since crude oil is traded globally in dollars, any fall in the rupee's value against the dollar could lead to higher import costs and subsequently impact gasoline prices.
• Transportation and Distribution Costs: Transportation and distribution costs associated with getting gasoline from refineries to points of sale also contribute to the final price. Factors such as logistics, infrastructure, and distance covered can affect these costs.
• Supply and Demand Dynamics: An imbalance of supply and demand can affect gasoline prices. If demand exceeds supply or interruptions in the production or distribution of gasoline, this can cause prices to rise.

It is important to note that fuel prices may vary between states in India due to variations in taxes and local factors. The government regularly reviews and revises fuel prices based on market conditions and prevailing policy decisions.

Oil Marketing Companies (OMCs) such as Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL) primarily determine retail fuel prices in India. These state entities control a significant portion of the fuel market in the country.

The Government of India introduced the dynamic pricing mechanism called the 'Daily Review of Fuel Prices' in June 2017, which led to daily changes in fuel prices in India.

Refineries are paid by Indian Oil Corporation for each litre of fuel, and subsequently, the corporation sells it to distributors at a higher rate than the amount paid to refineries. The retail price is determined by adding excise duty, dealer commission, and VAT to the selling price.

According to the brokerage, the companies have estimated a loss of Rs 1.2 per liter on the sale in the current quarter. However, the combined margin of both fuels has been made positive by a profit of Rs 6.8 per liter.