Petrol and diesel prices are a crucial aspect of the Indian economy, influencing consumer spending and transportation costs. Every morning at 6 am, oil marketing companies (OMCs) like Indian Oil, BPCL, and HPCL announce the prices of petrol and diesel for the day. This daily update ensures transparency and keeps consumers informed about the latest fuel costs. The prices are subject to fluctuations influenced by various factors, including global crude oil prices, exchange rates, and taxes.

Factors Affecting Petrol and Diesel Prices in India

Several key factors play a role in determining the prices of petrol and diesel in India:

Crude Oil Price

Crude oil is the primary raw material for producing petrol and diesel. Therefore, the global price of crude oil directly impacts the cost of these fuels. When crude oil prices rise, petrol and diesel prices also tend to increase, and vice versa.

Exchange Rate

India heavily relies on imported crude oil, making the exchange rate between the Indian Rupee and the US Dollar a significant factor. When the Rupee weakens against the Dollar, the cost of importing crude oil rises, leading to higher fuel prices.

Taxes

Both the central and state governments impose various taxes on petrol and diesel. These taxes, including excise duty and value-added tax (VAT), constitute a substantial portion of the final fuel price. State governments have the authority to adjust VAT rates, which can result in different petrol and diesel prices across different states.

Refining Costs

The refining process converts crude oil into usable fuels like petrol and diesel. This process involves expenses, such as the cost of refining infrastructure, labor, and energy. These refining costs contribute to the final price of petrol and diesel, and they can vary depending on factors like the type of crude oil used and the refinery’s efficiency.

Demand for Petrol and Diesel

Demand for petrol and diesel plays a role in influencing their prices. When demand is high, prices tend to rise. Conversely, when demand falls, prices may decrease. This dynamic is primarily influenced by factors such as economic growth, transportation trends, and consumer behavior.

Know the Price of Petrol and Diesel through SMS

The OMCs have made it convenient for consumers to access the latest fuel prices through SMS. By sending a simple message with specific keywords and city codes, customers can quickly receive information about the current petrol and diesel prices in their respective areas:

Indian Oil

• Keyword: RSP
• Code: City code
• Number: 9224992249

BPCL

• Keyword: RSP
• Number: 9223112222

HPCL

• Keyword: HP Price
• Number: 9222201122

Take Away Points

• Petrol and diesel prices are determined by a complex interplay of factors, including crude oil prices, exchange rates, taxes, and refining costs.
• The Indian government implements various taxes on petrol and diesel, significantly influencing their final prices.
• Consumers can easily access the latest petrol and diesel prices in their cities through SMS by contacting their respective OMCs.
• The daily updates of petrol and diesel prices by OMCs ensure transparency and keep consumers informed about fuel costs.
• Understanding these factors and the mechanisms used to determine petrol and diesel prices is crucial for consumers, businesses, and policymakers.