Today's Diesel Price in Odisha

In Bhubaneswar, the diesel price has moved in an upward trend in the first week of November 2017. On 1 October 2017, the fuel rate was Rs.63.18 that reduced to Rs.61.18 on 04 October 2017. We can spot a decreasing trend in October 2017. The fuel was sold at the highest rate of Rs.63.42 and at the lowest price of Rs.60.97 in October 2017. On the opening day of September 2017, in Bhubaneswar, diesel was priced at Rs.61.25 that further rose to Rs.63.12 on the closing day of the month. It means that the fuel price was down by 2.12%.

The current diesel rate in Cuttack has been moving in an upward trend in November 2017. If we look at monthly rates, fuel prices were not consistent in the city. On 1 October 2017, the fuel price was Rs.63.43 and was Rs.61.49 on 1 September 2017. On 1 July 2017, the fuel was priced less. In Rourkela, the fuel rate has moved in a rising trend in the first week of November 2017. Diesel was priced at Rs.64.85 on 1 October 2017. On 1 September 2017, the price was Rs.54.61. We can spot a slight variation in the current diesel price in all parts of the state because of dealer commission.

State-wise Levies on Diesel

Diesel is taxed differently in different states. According to the data published by Petroleum Planning and Analysis Cell on 04 October 2017, in Odisha, the state VAT levied on diesel was 26%. In Maharashtra, the local tax was 28.41%, and in Tamil Nadu, it was 25%. In Uttar Pradesh, the local tax was 20.19%. In West Bengal, it was 18.47%. In October 2017, Maharashtra and Gujarat have diminished the local tax to reduce the fuel price.

How are Diesel Prices in Odisha Revised?

Diesel prices are determined on the basis of crude oil prices and the INR/USD exchange rate. These two determinants tend to change frequently. Therefore, variations in crude oil rates and the exchange rate are reflected in the retail selling price. Since 16 June 2017, all oil marketing companies including Indian Oil, Bharat Petroleum and Hindustan Petroleum have been reviewing fuel prices (diesel and petrol) on a daily basis in Odisha. The system of daily revision is called Dynamic Fuel Pricing.

It is advisable to check the fuel price before you fuel your vehicles. Even a slight variation can make a big difference in the billing amount if your consumption is more. Consumers can make use of the mobile applications, SMS alerts and customer care support services offered by oil marketing companies in order to track daily updates. Fuel rates can be checked online. Moreover, OMCs display revised fuel prices at their premises.

Features of Dynamic Fuel Pricing

1. All diesel bunks in Odisha will revise the fuel rate at 06:00 a.m. every day.
2. The daily movements in the exchange rate and crude oil prices can be easily transferred to end users.
3. Inventory management can be easier for dealers and oil marketing companies.
4. Cash outflows will remain unaffected for oil marketing companies and dealers.
5. The Indian fuel retailing sector can be interlinked to overseas markets.

Computation of Diesel Prices in Odisha

The retail selling price paid by end users comprises of crude oil prices, taxes, expenses incurred by oil marketing companies, dealer commission and pollution cess. The cost of crude oil is a primary component. OMCs import crude oil from foreign oil marketing companies. As on 8 November 2017, the cost of WTI Crude Oil per barrel was $57.25. One barrel is equal to 159 litres. Taxes are of two kinds: 1) the central excise duty and 2) the state levies.

The excise duty is levied by the central government and was recently reduced to Rs.19.48 per litre on 03 October 2017. The local tax levied on diesel by the government of Odisha was 26%. Consumers will pay these two types of taxes, which are included in the final price. OMCs also incur various types of expenses such as marketing costs, operational expenses, entry taxes and freight charges. These expenses are also included in the price paid by consumers.

Factors Affecting Diesel Prices in Odisha

Why do diesel rates change? It is because of two factors: a) crude oil prices b) the INR/USD exchange rate. If crude oil rates increase, the cost of diesel will increase; if crude oil prices decrease, then the cost of diesel will decrease. Consequently, the INR/USD exchange rate impacts the fuel's price. If the INR falls against the USD, the cost of crude oil will increase, and thus the fuel's price will increase. On the other hand, if the USD gains against the INR, the diesel price will reduce as a result.

Is the Current Diesel Price in Odisha Impacted by GST?

The current diesel price in Odisha is not impacted by GST, which came into effect in July 2017. Including diesel, five petroleum products do not fall under the GST purview. GST, a unified tax system, is applicable to various types of commodities and services. Currently, GST is charged at 5%, 12%, 18% and 28%. The imposition of GST on diesel will bring down the cost of diesel. Tax on diesel is a major source of income for both the central and state governments. If GST is imposed on diesel, the revenue source for the government will be affected.