Diesel Price Today in India

Diesel is a type of fuel that is used to power vehicles such as buses, boats, trains, barges, and several other transportation vehicles. It is also found in machines such as farm and construction equipment. Diesel fuel is a hydrocarbon mixture in general. Known for its efficiency and mileage, it is used to power motor vehicles and equipment with diesel engines or compression-ignition engines. Diesel prices in India are revised daily, since June 15, 2017. Earlier, diesel prices used to fluctuate every two weeks. The price for Diesel (per litre) today is ₹90.03.

Factors Affecting Diesel Prices

• Cost of Crude Oil: The cost of crude oil is one of the major factors influencing diesel prices around the world. Diesel prices are determined by global demand, supply, and economic conditions for crude oil. Low production rates, increased international demand, and any political unrest in the world's crude oil-producing countries all have a significant impact on diesel prices.
• Demand and Supply of Diesel Fuel: The majority of the country's fleet vehicles run on petrol. If the supply of petrol falls due to a refinery problem or lagging imports, diesel stocks may fall. If transportation for the supply of diesel from one location to another cannot support the flow of supplies, diesel prices will remain relatively high. This has an impact on diesel prices in India, which are primarily determined by diesel exports from other countries.
• Tax Rates: Diesel tax rates are determined by local government policies regarding the imposition of fuel taxes. When the government of India raises fuel taxes, oil companies will raise the price of diesel in India to recover losses and maintain marginal profits in their oil business.
• Political Unrest: Any geopolitical tension that affects oil production around the world or in oil-producing countries will have a direct impact on fuel prices.
• Rupee- Dollar Exchange Rate: The rupee-dollar exchange rate is another factor that influences the country's diesel prices. Indian oil companies pay in US dollars for oil imported from other countries, but they incur expenses in rupees. When the rupee strengthens against the dollar while the price of crude oil falls, oil companies benefit, and vice versa.
• Logistics: Logistics is another factor that influences diesel pricing in India. Diesel transported over longer distances to cities or regions further from depots would be more expensive than diesel transported to locations closer to the oil companies' storage areas. The difference in diesel prices in different cities across the country may be significant between cities that are geographically distant from one another.

Deregulation of Diesel Prices

Diesel prices in India were deregulated in October 2014, linking them directly to international market rates. Prior to deregulation, the government regulated diesel rates. The deregulation allows the market to determine diesel prices without any government intervention. This means that any change in global crude oil prices will have an immediate impact on retail diesel prices. Deregulation allows the government to spend less on subsidies in an attempt to close the price gap between the global and domestic markets. It also encourages healthy competition among oil companies, which will eventually benefit end users by allowing them to enjoy lower prices and better service delivery.

Components of Diesel Price in India

The components that make up the retail selling price of diesel are:

• Cost of Crude Oil and Freight (C&F) charges
• Refinery Transfer Price (RTP)
• Price charged to dealers
• Central and State Taxes
• Dealer commission + other charges