Are the recent protests throughout the nation against the hike in fuel prices justified?

Submitted by rajat on Thu, 05-Jun-2008 - 18:19

International Price for a barrel of crude has shot upto $135. The Indian PSUs were being pressed beyond limits to maintain their costs. The fuel price hike seemed inevitable. Once it is in, so are the protests across the nation. Are they justified?

Submitted by Jayesh on Mon, 09-Jun-2008 - 23:15

Permalink

It's the main reason behind the government to subside the price of petrol. As of today the total subsidy amount on petrol and other is 2 lakh crore. From Jan 2007 the price of petrol has shoot up of 100% from 65 $/barrel to 135$/barrel in India the price of petrol has rise up only 35%. The indian government is controlling the price of petrol so save his vote bank. In one of the research it was found that top 20% of the population enjoy 43% benefit of the subsidy while low class would able to enjoy only 10% benefit of the subsidy. In 1974 when the price of the petrol shoot up overnight, Indian govenment didn't provide any subsidy, which in balance the supply demand and there was a correction in the world price and thing came back to normal in 6-8 month. Also, top 5 nation of the world give no subsidy on the price of petrol. Most of the subsidy given for petrol are in developing world. The only solution of this problem is to balance the demand supply which in turn will automatically bring the correction in the price of petrol.

Submitted by lalithgparmar on Fri, 13-Jun-2008 - 12:10

Permalink

With prices of Crude controlled by speulaors rather than demand and supply,I feel the govet shld change the way the fuel prices are prices...

As per the crude prices the petrol prices in country shld be arnd 32 Rs considering crude at 135 $ ..But the taxes by central govt and state govt have remained same...This means say crude at $50 which was taxed at say 4%,and now when the crude is 135 the taxed at same 4 %..So i dont see anything wrong in govt reducing the taxes...

A new system of pricing shld be initiaede in which the prices of petrol resemble global prices and not in hands of GOVT..This will mean identifying profits of PSU,having a common tax startegy statewise and at central..Thhus the petrol  prices will change everyday dfepending on GLOBAL crude price

Regards Lalith Parmar Vande Mataram For Blood Call 1062

1 - If petrol was to be sold after refining at International price, it will be much more costlier than what it is today. How you came to Rs 32/- is a bit difficult to grasp. 2 - Govt of India subsidises fuel to enormous amounts. Please see the other comment. Taxation on the subsidised fuel is not enough to suffice for the immense subsidies. 3 - If international rates were applicable, then for sure diesel and lpg would become dearer than ever before. Do we really want the subsidies to stop and commercialization to creep in? I would recommend my blog on Petrol prices http://www.google.com/url?sa=t&ct=res&cd=1&url=http%3A%2F%2Fwww.sankalp…

Sorry for that Rs 32 mark took that info from some mail may be oil prices were low at that time!!! Anyways just read the below things

The Global oil prices are at 135 dolars per barrel..

so taking 135 (which is max now) cost of 1 barrell is 135*42(Rate of dollar now) that costs 5670...with 1 barrel equivalent to 159 lites the cost of 1 litres comes arnd 35...

so 35 Rs per litre for crude....

Considerin the transportaion,refining cost ,profits of PSU and other things...which shld not cost morethan 8 Rs per litre...let us consider it as 15...

so the price is Rs 50 as of now we are buying petrol at 58 Rs...

 

The point here is 21% service tax is added by Govt of Karnatake and some x % my Govt..The govt is under tremendous pressure now because they had already waved off loans to farmers worth 80000 crores (and i doubt whether the farmers are really benifitting from this...) and now they are not in any position to do anything more...

so i dont belve the Govt is subsidizing the fuel to a large amnt and i dont want them to..Let everything from top to bottom be disclosed to Public as its an essential commodity and let pricing be as it is...

Right from cost of crude+refinery costs+profit+trasportaion .let it be made open..then we can easily comment on whether it is been subsidized or whether it is adding to the exchequer!!!!

As of now i firmly belive in only one thing the true prices of oil are not reflecting the demand and supply buy they in control of speculators and nothing else!!!!

Regards Lalith Parmar Vande Mataram For Blood Call 1062

Submitted by Jayesh on Mon, 14-Dec-2009 - 11:06

Permalink

State-run oil marketing companies Indian Oil, Hindustan Petroleum and Bharat Petroleum are likely to lose Rs. 45,478 crore this fiscal on selling fuel below cost price, Petroleum Minister Murli Deora has said. Addressing the Parliamentary Consultative Committee on Thursday evening, Mr. Deora said such a huge subsidy support was unsustainable in long run. “Today, the public sector oil marketing companies incurs an under-recovery (revenue loss) of Rs. 3.10 per litre on petrol, Rs. 2.55 a litre on Diesel, Rs. 17.30 per litre on PDS kerosene and Rs. 241.00 on each 14.2 kg cylinder of domestic LPG,” he said. “The delay in oil bonds is reflecting on their financial performance,” he said. In the second quarter ended September 30, IOC reported a meagre profit of Rs. 284 crore while BPCL and HPCL reported losses of Rs. 159 crore and Rs. 137 crore respectively. Source: http://beta.thehindu.com/business/Industry/article63573.ece