[Vitalstatistiks]

Originally Posted by drmohitg

Interesting. When crude was free falling, the prices weren't being decreased or were being countered by increasing the taxes. Now when actually the prices have increased marginally, there is a price drop. Makes me feel that this country should stay in eternal election mode only. Thats the only time when "common man" is the priority.

I am no oil industry expert, but common sense suggests that OMCs in India don't buy crude from market on a 'hand to mouth' basis. In other words, the petrol that you fill up today was not bought last night. The process of purchasing crude, refining and then passing it on to the bunks takes at least a couple of weeks. Add to that the periodic hedging agreements entered into by OMCs, by virtue of which they continue to buy crude at a certain price regardless of market prices. Sum on the above can easily explain a price cut when crude has moved (slightly) upwards.

Having said the above, I think it is high time OMCs explain the manner of price calculation that they do and the complete break up of prices on a regular basis, rather than giving a headline figure for petrol/diesel.

[drmohitg]

Originally Posted by Vitalstatistiks

I am no oil industry expert, but common sense suggests that OMCs in India don't buy crude from market on a 'hand to mouth' basis. In other words, the petrol that you fill up today was not bought last night. The process of purchasing crude, refining and then passing it on to the bunks takes at least a couple of weeks. Add to that the periodic hedging agreements entered into by OMCs, by virtue of which they continue to buy crude at a certain price regardless of market prices. Sum on the above can easily explain a price cut when crude has moved (slightly) upwards.

Such explanations have been put forward many a times before but if you follow the price adjustments post de-regulation ( real or apparent), you will clearly see that this logic is not followed consistently. It is more according to the whims and fancies of the ruling class.

Originally Posted by drmohitg

Such explanations have been put forward many a times before but if you follow the price adjustments post de-regulation ( real or apparent), you will clearly see that this logic is not followed consistently. It is more according to the whims and fancies of the ruling class.

drmohitg
I would have to agree with you. A lot of the price cuts happen at vital times in the run of life in the country.

The Delhi elections are on. Corruption and non-corruption does not seem to be as large an issue. People have election fatigue. This is a nice sop to give for those people who are going to turn up and be completely undecided.

[sgiitk]

@Vitalstatistiks; RIL relies almost totally on high-seas petroleum. This was Dhirubhai's model.

[narayan]

Guys
is there any retail sales data numbers published anywhere for Diesel/Petrol ? Just want to see if there was any increase in consumption post price reductions ?

[sgiitk]

I hear that RIL will recommission its outlets by 1 January 2016, and assuming the govt does not play spoilsport significantly expand the network thereafter. I am looking forward to this. Essar are small players, and Shell buys its fuel from IoC.

[1lokesh]

Originally Posted by sgiitk

I hear that RIL will recommission its outlets by 1 January 2016, and assuming the govt does not play spoilsport significantly expand the network thereafter. I am looking forward to this. Essar are small players, and Shell buys its fuel from IoC.

Few of the RIL outlets are already operational. They are testing waters and their confidence on this Govt. If symptoms are to be believed, RIL will start reviving their outlets by mid of this year itself.

[mpksuhas]

Originally Posted by sgiitk

I hear that RIL will recommission its outlets by 1 January 2016

I am already seeing few of their outlets working and have put up 'Diesel available' signboards.

[S_U_N]

Originally Posted by sgiitk

I hear that RIL will recommission its outlets by 1 January 2016, and assuming the govt does not play spoilsport significantly expand the network thereafter. I am looking forward to this. Essar are small players, and Shell buys its fuel from IoC.

I have to ask: Is this going to bring in competition? Or is RIL also going to follow the Government diktat around the pricing?
Secondly, is it then a good time to buy RIL stocks?

[sgiitk]

@S_U_N; They are a bit surer about this lot - no more subsides only to the sarkari OMCs. As, for the market I will do nothing till the Delhi results are out. Could be a 2% upturn or a 5%+downturn.

[mukeshgoel]

Petrol to be costlier by over Rs 2 per litre in Haryana as government hikes VAT.

Haryana government had on November 25 raised the VAT on diesel.

http://www.abplive.in/business/2015/...ment-hikes-VAT

[sdp1975]

Oil rose above $60 a barrel on Friday for the first time this year, bringing its gain this week to almost 4 percent, supported by signs that deeper industry spending cuts may curb excess supply.

Source : http://www.reuters.com/article/2015/...0LH08120150213

[sgiitk]

The Bank of England is looking at Brent at about $70 during the next year. So let us see, a lot may also depends where Rajan tries to keep the $ to ₹ rate.

[sgiitk]

Now gear up for a hike next week - say at least ₹2 per litre on petrol. Also, IoCC asking for daily revision of prices. It will be interesting to see this in rural areas! They have a lot of red ink on their books, so logically IoC prices should go up, and on the same token BP down! True competition!

[humyum]

Originally Posted by sgiitk

Now gear up for a hike next week - say at least ₹2 per litre on petrol. Also, IoCC asking for daily revision of prices. It will be interesting to see this in rural areas! They have a lot of red ink on their books, so logically IoC prices should go up, and on the same token BP down! True competition!

But I saw the BPCL results yesterday and they said BPCL is making 1.4 rupees profit on Diesel and 1.8 on Petrol.

IOC on the other hand had horrendous results with inventory losses which were unreal to say the least.

I don't get, how two companies doing the same thing and probably getting oil at same price have such vast difference figures to show.