Top 10 highlights as petrol prices rise to 55-month high, diesel at costliest ever
1. Petro products need to be brought under GST, says Pradhan:
Petroleum and Naural Gas Minister Dharmendra Pradhan on Friday stressed on bringing petroleum products under the GST to provide relief to common people from spurt in fuel prices
following surging global crude oil rates. Both the central and state governments have started making up their mind in this regard, he said. Petroleum products are out of GST ambit which was rolled out in July last year.
"The prices of petroleum products are all time high in past four years in international market due to some disturbances in Syria and US's threats to impose fresh sanctions on Iran," Pradhan told reporters here.
"Government of India is concerned over it...petroleum products have to be brought under the purview of the Goods and Services Tax (GST) but since this is the first year of the implementation of GST, so states are concerned and hesitant about their income," the minister said while responding to a query in this regard.
2. The BJP-led government had raised excise duty nine times between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre.
3. Petrol prices in Delhi touched a new high of Rs 74.08 per litre on Friday, the highest in nearly five years. Back in September 2013, the price had touched Rs 74.10 a litre. Other metro cities such as Kolkata, Mumbai and Chennai too witness new multi-year highs at Rs 76.78, Rs 81.93 and Rs 76.85 per litre respectively, the Indian Oil website said.
4. The previous highs in these cities were Rs 78.03 (Kolkata, August 2014), Rs 82.07 (Mumbai, March 2014) and Rs 76.93 (Chennai, July 2014).
5. Diesel prices also touched new record levels on Friday with prices in Delhi, Kolkata, Mumbai and Chennai at Rs 65.31, Rs 68.01, Rs 69.54 and Rs 68.90 per litre respectively.
6. Petroleum Minister Dharmendra Pradhan last fortnight had said the GST Council - the apex decision making body of the new indirect tax regime - should in the "interest of energy security and consumers" include petroleum products in GST. Petrol, diesel, natural gas, crude oil and jet fuel (ATF) are currently not included in the GST, which essentially leads to producers not being able to set-off tax paid on inputs from final tax on product.
Crude oil price at US $ 74 per barrel is still lower than US $ 105 four years ago. So, why are Petrol/Diesel prices higher today than they were in May 2014?
— P. Chidambaram (@PChidambaram_IN) April 20, 2018
7. Petrol prices firmed up on Friday along with surge in crude oil prices due to the ongoing supply cut by the Organisation of the Petroleum Exporting Countries coupled with strong demand for crude oil. On Friday, Brent crude oil was priced around $73.56 per barrel, whereas in 2013 it was priced at over $100 a barrel.
8. The National Democratic Alliance government — that came to power in 2014 — gained a massive revenue boom from taxes on petroleum products, as against the United Progressive Alliance (UPA) rule, when the government spent its revenues in subsidies.
In February 2016, OMCs bought crude at Rs 1,760 per barrel (Rs 11 per litre), while retail petrol stood at Rs 60 per litre. The government earned Rs 21 per litre of petrol the OMCs sold. Under the UPA rule in September 2013, OMCs bought crude oil at Rs 7,400 per barrel of oil (Rs 47 per litre) while diesel was priced at Rs 53 per litre in New Delhi. The government paid out Rs 15 per litre of diesel sold.
9. State-owned oil companies - Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation - in June last year dumped the 15-year old practice of revising rates on the 1st and 16th of every month . Instead, they adopted a daily price revision system to instantly reflect changes in cost. Since then, prices are revised on a daily basis.
10. The central government had cut excise duty by Rs 2 per litre in October 2017, when petrol price reached Rs 70.88 per litre in Delhi and diesel Rs 59.14. Due to the reduction in excise duty, diesel prices had on October 4, 2017 come down to Rs 56.89 per litre and petrol to Rs 68.38 per litre. However, a global rally in crude prices pushed domestic fuel prices
far higher than those levels.