why the Indian consumer never wins?

Satyakam Gautam writes…”Since 1st oct when brent touched USD 86 levels, it has fallen to current $65 levels. Assuming landed cost as $65 USD/INR at 72.5, per gallon cost is 4712 INR per gallon”.

The Nov contract for MCX crude oil ( which captures crude oil in Indian Rupee) fell from a high of 5600 in oct to almost 4000 today …..a loss of almost 40% . 

Per litre cost is 712/159= INR 29.63 . Add Oil marketing companies margin and freight cost of Rs 3.82 per litre. Becomes 33.45. Add central excise of Rs19.48 per litre, it becomes 52.93. Add 3.66 commission to dealers, it becomes
56.59. Add 27% state VAT

Per litre cost comes at 71.87.

But today’s petrol price in Mumbai is 83 down only 5% from the high seen few days back

Well central govt is happy, state govts are happy, omc’s are happy ,but the customer is clueless how can this be happening. Then some Eloquent north block bureaucrat might tweet GOVT cant reduce prices because it affects fiscal deficit. Really. If the choice is between filling govt coffers to do wasteful revenue expenditure or letting retail prices truly mimic global prices which helps in lower input costs, lower CPI, leading to lower cost of capital leading to better utilisation of scant economic resources, the choice is pretty clear.

Conclusion

It  does not matter whether brent is at 35 or at 85, the uninformed Indian petro consumer has no choice but to shell out same so that govt can keep on doing wasteful expenditure. So much respect for consumer and that too from govt itself.