Petrol and diesel prices will change daily in some cities from next month. The change will be in accordance with the international rates confirmed officials from oil marketing companies. Depending on the consumer response, the continual price change in petrol and diesel will be extended to other cities in the country.
What all cities come under the pilot project?
The five cities that are set to witness continual change in petrol and diesel prices include Puducherry, isakhapatnam, Udaipur, Jamshedpur and Chandigarh. Out of the aforementioned cities, the fuel bunks will remain closed on Sundays in Puducherry from May 14, 2017.
Dynamic pricing successful at several outlets
In India change in price of petrol and diesel is directly related to the crude oil like in several other countries. In a bid to see consumers’ response, some retailers have already introduced dynamic pricing at their outlets and to their joy, it has worked well for them. However, the change will be formally introduced from May 1, 2017 in five cities.
Factors that drive change in fuel prices
The state-run fuel retailers which include Hindustan Petroleum Corp Ltd,Bharat Petroleum Corp Ltd and Indian Oil Corp Ltd change the pricing on the 1st and 15th of every month. The change in price is in tandem with the average international price of the fuel in the previous fortnight. Another factor that directly effects the fuel price change is the currency exchange rate. Additionally, the central government and state taxes form a major chunk of the retail price that varies slightly for petrol and diesel.
How much will be price change and what are the impacts?
The change in prices of petrol and diesel are likely to be within the range of few paise per litre. This will indeed avert the political pressure to revise prices. With this change in force, the customers will not have to bear the brunt of notable change in pricing, which usually creates chaos among consumers.
The change in fuel pricing (petrol and diesel) was earlier controlled by the government. Though from 2010, the oil companies have the liberty to change rates but they still need to involve government for their opinion.