Lok Sabha Question No. 1033 (UNSTARRED), answered on 2018-12-17
Subject: Prices of Petroleum Products
Ministry: PETROLEUM AND NATURAL GAS
Asked by: RAM KUMAR SHARMA KUSHWAHA, DODDAALAHALLI KEMPEGOWDA SURESH, PREM SINGH CHANDUMAJRA, C. N. JAYADEVAN, MD. BADARIDDOZA KHAN, VEENA DEVI, Tejpratap Singh,Yadav, DUSHYANT CHAUTALA, K. C. VENUGOPAL, E. T. MOHAMMED BASHEER, SAUGATA ROY, M. B. RAJESH, NALIN KUMAR KATEEL, T.G. VENKATESH BABU

## LOK SABHA UNSTARRED QUESTION NO. 1033

## TO BE ANSWERED ON 17 TH  DECEMBER, 2018

## Prices of Petroleum Products

## †1033. SHRI RAM KUMAR SHARMA:

SHRI D.K. SURESH:

PROF. PREM SINGH CHANDUMAJRA:

SHRI C.N. JAYADEVAN:

SHRI MD. BADARUDDOZA KHAN:

SHRIMATI VEENA DEVI:

SHRI TEJ PRATAP SINGH YADAV:

SHRI DUSHYANT CHAUTALA:

SHRI K.C. VENUGOPAL:

SHRI E.T. MOHAMMED BASHEER:

PROF. SAUGATA ROY:

SHRI M.B. RAJESH:

SHRI NALIN KUMAR KATEEL:

SHRI VENKATESH BABU T.G.:

पेट्रोल ियम और प्राक ृ तिक गैस मंत्री

## Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

- (a) whether the prices of Brent/ international Crude oil fell by 23 per cent from its peak in October to November, 2018 and there has been huge decline in the Indian basket of crude prices  during  the  last  two  months  along  with  strengthening  of  rupee  have  resulted  in  huge decline in our import bill;
- (b) if so, the details thereof along with the reasons for not reducing the prices of petrol, diesel and petroleum products in proportion to reduction of prices of international crude oil from October to November, 2018 product/month-wise along with impacts of lowering of crude oil prices on the import bill/country during the current year;
- (c)  whether  the  price  of  petroleum  products  have  been  increasing  day  by  day  amongst protests/Bharat band by several organisations and reached to record level despite reduction in prices of crude oil in the international market and if so, the details thereof;
- (d)  the  cascading  effects  of  such  increase  on  essential  commodities  and  common  people along  with  measures  taken/  being  taken  by  the  Government  including  change  of  existing pricing  mechanism  of  petroleum  products  to  reduce  the  prices  of  petroleum  products  and bring them under control;
- (e)  whether  the  Government/State  Governments  propose  to  reduce  taxes/  excise  duty  and subsidy provided on petrol and diesel to ensure that essential commodities are available to

common people at cheaper prices in the country and if so, the details thereof along with the number of times customs and excise duty increased during the last four years;

(f)  whether  the  Government is  selling  petrol/diesel  to  other  countries  and  if  so,  the  details thereof along with the prices at which the products are being sold, country-wise; and

(g) the details of the amout paid to the Government by Oil Marketing Companies as tax and profit during the last five years, company/year-wise?

## ANSWER

## पेट्रोल ियम और प्राक ृ तिक गैस मंत्री (श्री धमेन्द्र प्रधान)

## MINISTER OF PETROLEUM AND NATURAL GAS (SHRI DHARMENDRA PRADHAN)

- (a) & (b) The prices of Brent Crude oil, Indian basket of crude oil and retail selling price of petrol/diesel at Delhi (as per IOCL) on 23 rd October, 2018 and as on 11 th December, 2018 are given as under:-

| Particulars   | Brent Crude   | Indian Basket of Crude Oil   | Petrol   | Diesel   |
|---------------|---------------|------------------------------|----------|----------|
| Prices as on  | $/bbl         | $/bbl                        | ` /ltr   | ` /ltr   |
| 23.10.2018    | 78.09         | 78.11                        | 81.34    | 74.85    |
| 11.12.2018    | 59.74         | 58.78                        | 70.20    | 64.66    |

The prices of petroleum products are linked to the price of respective products in the international market and not to that of crude oil.  Oil Marketing Companies take a decision on retail selling price after considering various aspects including international  product  prices,  exchange  rate,  tax  structure,  inland  freight  and  other cost elements and the pricing formula is based on 15-day moving average of the key cost elements in price build up of petrol and diesel.

The import bill of crude oil which was ` 2.42 Lakh crores during the period April to September,  2017  has  increased  to  Rs.4.04  Lakh  crores  during  the  period  AprilSeptember, 2018.

- (c) to (e) Prices of petrol and diesel have been made market-determined by the Government with  effect  from  26.06.2010  and  19.10.2014  respectively.  Since  then,  the  Public Sector  Oil  Marketing  Companies  (OMCs)  take  appropriate  decision  on  pricing  of petrol and  diesel in line with international product  prices and  other  market conditions.  The  OMCs  have  not  only  increased  but  also  decreased  the  prices accordingly.  The Government continues to modulate the effective price to consumer for Subsidized Domestic LPG and RSP of PDS Kerosene.

With  an  aim  to  reduce  the  prices  of  petrol  and  diesel  and  give  relief  to  the consumers, the Central Government reduced the Central Excise duty on petrol and diesel by ` 2 per litre with effect from 4 th October, 2017.  The Central Government further reduced the Central Excise duty on petrol and diesel by ` 1.50 per litre with effect from 5 th October, 2018 and Public Sector OMCs also reduced ` 1.00 per litre to  reduce  the  overall  price  of  petrol  and  diesel. The  Central  Government  also requested  the  State  Governments  to  make  a  reduction  of ` 2.50  per  litre  in  VAT imposed  by  them  on  petrol  and  diesel.  Accordingly,  18  State  Governments  and  1 Union Territory have reduced VAT on petrol and diesel.

The details of increase/decrease in Customs and Excise duty on petrol and diesel in the last four years are given as Annexure-I.

- (f) Oil  Marketing  Companies  export  petrol  and  diesel  out  of  surplus  arising  after meeting  the  domestic  demands.    As  per  IOCL,  during  Financial  Year  2018-19 (April-October),  1143  TMT  HSD  and  108  TMT  MS  is  exported  to  Indonesia, Bangladesh,  Malaysia,  Mayanmar,  Singapore,  UAE,  Yemen  and  Sri  Lanka  for  an amount of ` 5652 crore.  Further, 229 TMT MS and 784 TMT HSD of ` 5217 crore has been exported to Nepal under a supply agreement between IOCL and Nepal Oil Corporation (NOC).  Also, 8 TMT MS and 37 TMT HSD of ` 292 crore has been exported to Bhutan.
- (g) The  details  of  the  amount  paid  to  the  Government  by  oil  and  gas  companies  as contribution to exchequer (includes taxes, dividend etc.) during the last five years is given at the Annexure-II

x-x-x-x-x

## Annexure-I

Annexure referred to in reply to parts (c) to (e) of Lok Sabha Unstarred Question No. 1033    asked  by  Shri  Ram  Kumar  Sharma,  Shri  D.K.  Suresh,  Prof.  Prem  Singh Chandumajra,  Shri  C.N.  Jayadevan,    Shri  Md.  Badaruddoza  Khan,  Shrimati  Veena Devi, Shri Tej Pratap Singh Yadav, Shri Dushyant Chautala, Shri K.C. Venugopal, Shri E.T.  Mohammed  Basheer,  Prof.  Saugata  Roy,  Shri  M.B.  Rajesh,  Shri  Nalin  Kumar Kateel and Shri Venkatesh Babu T.G. to be answered on 17 th December, 2018 regarding 'Prices of Petroleum Products'.

## Changes in Excise duty on petrol and diesel during the last four years

| Date (w.e.f.)   | Petrol            | Diesel            |
|-----------------|-------------------|-------------------|
|                 | Total ( ` /litre) | Total ( ` /litre) |
| 14.09.2012      | 9.48              | 3.56              |
| 13.11.2014      | 11.02             | 5.11              |
| 03.12.2014      | 13.34             | 6.14              |
| 02.01.2015      | 15.40             | 8.20              |
| 17.01.2015      | 17.46             | 10.26             |
| 01.03.2015*     | 17.46             | 10.26             |
| 07.11.2015      | 19.06             | 10.66             |
| 17.12.2015      | 19.36             | 11.83             |
| 02.01.2016      | 19.73             | 13.83             |
| 16.01.2016      | 20.48             | 15.83             |
| 31.01.2016      | 21.48             | 17.33             |
| 04.10.2017      | 19.48             | 15.33             |
| 05.10.2018      | 17.98             | 13.83             |

Annexure referred to in reply to part (g) of Lok Sabha Unstarred Question No. 1033 asked by Shri Ram Kumar Sharma, Shri D.K. Suresh, Prof. Prem Singh Chandumajra, Shri  C.N.  Jayadevan,    Shri  Md.  Badaruddoza  Khan,  Shrimati  Veena  Devi,  Shri  Tej Pratap  Singh  Yadav,  Shri  Dushyant  Chautala,  Shri  K.C.  Venugopal,  Shri  E.T. Mohammed Basheer, Prof. Saugata Roy, Shri M.B. Rajesh, Shri Nalin Kumar Kateel and  Shri  Venkatesh  Babu  T.G.  to  be  answered  on  17 th December,  2018  regarding 'Prices of Petroleum Products'.

## Contribution of Petroleum Sector to exchequer

` crore

| Particulars                                               | 2013-14                              | 2014-15                              | 2015-16                              | 2016-17                              | 2017-18                              | H1, 2018-19 (P)                      |
|-----------------------------------------------------------|--------------------------------------|--------------------------------------|--------------------------------------|--------------------------------------|--------------------------------------|--------------------------------------|
| 1. Contribution to Central Exchequer                      | 1. Contribution to Central Exchequer | 1. Contribution to Central Exchequer | 1. Contribution to Central Exchequer | 1. Contribution to Central Exchequer | 1. Contribution to Central Exchequer | 1. Contribution to Central Exchequer |
| Tax/ Duties on Crude oil& Petroleum products              | 105950                               | 126025                               | 209354                               | 273225                               | 284446                               | 135363                               |
| Dividend to Government/ Income tax etc.                   | 46950                                | 46040                                | 44261                                | 61309                                | 59416                                | 21501.92                             |
| Total Contribution to Central Exchequer                   | 152900                               | 172065                               | 253615                               | 334534                               | 343862                               | 156864.92                            |
| 2. Contribution to State Exchequer                        | 2. Contribution to State Exchequer   | 2. Contribution to State Exchequer   | 2. Contribution to State Exchequer   | 2. Contribution to State Exchequer   | 2. Contribution to State Exchequer   | 2. Contribution to State Exchequer   |
| Tax/ Duties on Crude& Petroleum products                  | 152442                               | 160526                               | 160114                               | 189587                               | 208893                               | 115461                               |
| Dividend to Government/ Direct tax etc.                   | 18                                   | 28                                   | 95                                   | 183                                  | 262                                  | 38                                   |
| Total Contribution to State Exchequer                     | 152460                               | 160554                               | 160209                               | 189770                               | 209155                               | 115499                               |
| Total Contribution of Petroleum Sector to Exchequer (1+2) | 305360                               | 332619                               | 413824                               | 524304                               | 553017                               | 272363.92                            |

1. As per details provided by 16 oil & gas companies
2. Profit petroleum on exploration of Oil/ Gas as provided by MOP&NG.
3. Figures for the previous periods have been regrouped wherever necessary.