Diesel Price In Uttar Pradesh
The daily revision is the new system of fuel pricing that has been implemented in India on 16 June 2017. According to the new system, all diesel bunks across the state will update diesel prices on a daily basis. Since all state-run oil marketing companies have adopted the daily revision, diesel rates have seen a steady and constant growth. All automated diesel bunks will automatically revise diesel prices every day. All non-automated diesel bunks will manually revise.
Features of the daily revision
- Prices will be revised on a daily basis at 06:00 a.m.
- Diesel consumers will be aligned to market dynamics.
- The system brings transparency in fuel pricing.
- Bunk owners will be able to practice the best inventory management principles.
- Neither the central government nor the state government will interfere in fuel pricing.
Computation of Diesel Price in UP
The actual cost of diesel per litre is computed using the following equation:
Retail price = Cost of crude oil + Refinery transfer price + Profit margin of oil marketing companies + Commission charged by dealers + Excise duty + State levies (VAT)+ pollution cess
Factors Affecting Diesel Price in UP (Uttar Pradesh)
The Cost of Diesel will increase if:
- The cost of crude oil goes up in overseas markets
- The currency of the United States of America (USA) gains against the currency of India
- The central government decreases the excise duty
- The state government decreases VAT
The Cost of Diesel will decrease if:
- The cost of crude oil decreases in overseas markets
- The currency of the United States of America (USA) falls against the currency of India
- The central government increases the excise duty
- The state government increases VAT
- Factors affecting the cost of crude oil
The Cost of Crude Oil will increase if:
- The demand for crude oil increases
- Oil extraction activities are interrupted by unfavorable weather conditions
- The INR weakens against the USD
The Cost of Crude Oil will decrease if
- The demand for crude oil is stable
- Oil extraction activities remain unaffected by weather conditions
- The INR gains against the USD
Impact of GST on Diesel Price in UP (Uttar Pradesh)
Present Scenario
- All petroleum products are not covered under the GST regime.
- The entire oil and natural gas industry has been kept outside the purview of GST.
- All industry participants continue to pay taxes as per the earlier system.
If GST is Imposed on Diesel:
- All industry participants have to follow the current and the GST framework.
- The compliance cost will be increased by 100%.
- The current price of diesel in Uttar Pradesh will fall by 20-30%.
- Diesel consumers will be benefited.
- The revenue source for the central and state governments is adversely impacted.
