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Friday, June 28, 2013

Petrol hike... to cost Rs.1.82 more from tonight

You read with not much of interest that rupee is weakening and has touched historical high in exchange to dollar… nothing affected you – thought so…

A couple of days ago, when mopeds ruled the roads ~ the common man would stand in long queues at petrol bunks the day prior to the budget, fearing a hike in petrol hike…………. Not for once he thought that with his limited capacity petrol tank, nothing much would change ….but to the good planner every pie saved was rupee earned and hence such attempts to fill the tank to its capacity in perhaps the lower price………….

Gone are those days…. Not that common man has grown wiser… fact is ~ petrol hikes do not occur with every budget, they happen any time – infact keeps increasing all the time.  The month of June is yet to end and has seen the third such price hike………… the news is that petrol price was today hiked by a steep Rs 1.82 a litre,  as falling rupee made imports costlier.

At Chennai on May 1 2013 it was Rs.65.90; on 1st June it was 66.85 and on 16th June it was 69.39;  At Delhi:  May 1 2013 it was Rs.63.09; on 1st June it was 63.99 and on 16th June it was 66.39  ~ from midnight of today, it would sell at Rs.68.58.

An increase in diesel rates is expected early next week. Oil companies raised petrol rates by Rs 1.82 a litre, excluding local sales tax or VAT, with effect from midnight. Actual increase will be higher and will vary from city to city depending on local taxes. The revision in prices as per the practice of changing rates in line with cost every fortnight, was due on Sunday June 30 but were raised today. Diesel price too is expected  to be raised by 40-50 paisa per litre early next week in accordance with the government mandate for small doses of increases every month.

This week’s increases have almost negated the four reductions this year that had brought down the rates at the beginning of May.  The deterioration of Exchange rate is quoted as the reason by Indian Oil Corporation.  Diesel prices have been hiked on five occasions since January when the government authorised state-owned oil firms to increase prices by up to 50 paisa per litre every month till entire losses on the fuel are wiped out.

Don’t be surprised if your autowallah in Chennai charges Rs.10/- more per kilo metre.  LPG, kerosene, diesel and petrol prices are bench marked to global prices. These benchmarks are used for calculating desired price of the fuels as well as the revenue loss incurred by oil marketing companies (OMCs) on selling below that price. Oil companies were allowed to revise price of petrol in accordance with international prices and exchange rate in June 2010 and diesel price since this January is moving towards market price. Non-subsidised LPG cylinder too is marked to international price. The Singapore region price for petrol is used for this purpose.

So, more expenses from tomorrow is the news as you are about to hit the bed

With regards – S. Sampathkumar
28th June 2013.


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