Comparing Effects of Including Fuel price (Petrol) with and without GST in Kerala 2019
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| Duties levied by Central and State Govt. |
Crude oil price = 61 $ /barrel
Crude oil Price in Rs/Litre. = 27.65 Rs/litre
Entry Tax ,Refining process,Other operational cost Rs/litre =6Rs
Transportation cost Rs/litre = 3.31Rs
Crude oil Price in Rs/Litre. = 27.65 Rs/litre
Entry Tax ,Refining process,Other operational cost Rs/litre =6Rs
Transportation cost Rs/litre = 3.31Rs
Price charged to dealers excluding
excise and VAT Rs/Litre =36.96Rs
Add.Excise duty Rs/Litre (Before
GST) = 17.98
Add Excise duty Rs/Litre (After GST)
=0
Add.Dealer commission (average)
Rs/Litre =3.40
Total Before GST =58.34 Rs/litre
Total After GST =40.36 Rs/litre
Add.VAT applicable for state@ 3o.37%
Rs/Litre Before GST =17.71Rs
Add.VAT applicable for state After GST
Rs/Litre =0
Add. GSTat peak rate of 28% Rs/Litre
After GST= 11.03
Retail selling price After GST
Rs/Litre =51.39 Rs
Retail selling price Before GST Rs/Litre= 76 Rs
Retail selling price Before GST Rs/Litre= 76 Rs
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| Fuel Duties and Revenues |
Difference (Before GST-After GST) Rs/Litre
=24.61 Rs
- VAT charge is 30%
- GST comes under different slabs 5/12/18/28% if even max GST is levied we can save 24 Rs/Litre
- To maintain existing revenues under GST Govt has to impose 60% GST slab for petrol.
Processing crude oil->
Crude Oil -> Refining -> Petrol -> Refining margin,
Transportation, vendor commission = Production cost of Petrol
(1 barrel of crude oil yields 150 litre of petrol)
Average value of dollar this year = Rs.61.53
Average price of crude oil barrel this year = $61/barrel
Refining, margin, transportation, commission per barrel = Rs. 672 (approx $12)*
150 litre of petrol = 61.× 61.53 + 672 = Rs. 4425
i.e. 1 litre of petrol = 4425 / 150 = Rs. 29.5
The cost depends on factors like quality of crude oil, refinery. However changes in it would not greatly affect product price.
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| Crude Oil Processing Flow Chart |
(1 barrel of crude oil yields 150 litre of petrol)
Average value of dollar this year = Rs.61.53
Average price of crude oil barrel this year = $61/barrel
Refining, margin, transportation, commission per barrel = Rs. 672 (approx $12)*
150 litre of petrol = 61.× 61.53 + 672 = Rs. 4425
i.e. 1 litre of petrol = 4425 / 150 = Rs. 29.5
The cost depends on factors like quality of crude oil, refinery. However changes in it would not greatly affect product price.
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| Crude Oil Price Vs Petrol Diesel Price |
The value to dollar is given by petroleum products because
america has stopped valuing its dollar with gold years before since the
gold values were fluctuating. Since after world war-2 world was flooded
with dollars and it enabled the world to use dollar as they would
with gold. Oil which is global commodity was traded using dollars
which simplifies the system. Due to this hard link of dollar with oil
dollar remains as the reserve currency of world.
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| Oil and Dollar Relation Trend Chart |
Middle
east countries will accept dollars for selling petroleum since they are
still paying back their debts in dollars to america.
Suppose India
want to buy petrol they have to pay in dollars to Middle East,for that we need
to buy American dollars. so buying additional Dollar from currency
traders will depreciate Rupee value and appreciate dollar value
.Crude oil Price is determined by OPEC which
accounts around 40% of world oil supply, OPEC will cut down its
productions to increase crude oil price in international market .
When US entered crude oil market since they have surplus productions
OPEC increased their productions to lower the crude
oil rate that will affect US influence in crude oil market and
the prices fall down from 100$ per barrel to 55$ per barrel
.
Now due to internal
problems some middle east countries want revenues and they cut down their
productions to increase the demand, along with this recent sanctions
on Iran will certainly bring up the crude oil price in coming
future.
Indian Oil and Gas Companies and Administration.
 |
| Structural Chart of Indian Petroleum Organizations |
Profit margin of Indian oil companies
ONGC 62296 crores
Indian oil 42113 crores
Bharat Petroleum 17058 crores
Hindustan Petroleum 12944 crores
GAIL 8454 crores
Capex Expenditure for oil companies in India
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| Capital Expenditure of Oil companies in India |
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| Share Holding Pattern for Oil Companies in India |
If the government will subsidies Diesel price, fiscal
deficit will increase means govt is spending more money than it makes.This
subsidy will be payed from tax payers money. When crude oil price dropped the
then govt removed the subsidies and the decided to deregulate fuel prices means
govt does not control fuel prices and price control depends on price of crude
in international market and oil refining charges. Depends on that oil companies
will revise the prices every 15 days depends on the existing situations.And
they have recovered from the losses happened before.
Petrol Pumps ownership is classified as, dealer owned and
operated, directly company owned and operated, company owned dealer operated .
When public firms came forward to
own and operate petrol pumps they succeeded in catching the market bulky, these
events triggered the state firms to increase dealerships drastically .This
expansion cause decrease in volume of fuel available in pumps for selling and
their profits have gone down, apart from that the volume of fuel available to
dealers will not be exactly as billed to dealers since petroleum is volatile
and temperature variations while filling and transportation will cause the
product to evaporate and volumetric quantity will vary. Since dealers have
made agreements with company regarding the acceptable variance in sales per day
they have to adjust the amount of fuel delivered to customer for keeping their
profit in safe limits.
