Lok Sabha Question No. 2884 (UNSTARRED), answered on 2024-08-08
Subject: Increase in Price of Fuel
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Shri Satpal Brahamchari

## LOK SABHA UNSTARRED QUESTION NO. 2884 TO BE ANSWERED ON 08 AUGUST, 2024

## Increase in Price of Fuel

†2884 Shri Satpal Brahamchari:

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũी

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

- (a) the year-wise/category-wise details of increase in the prices of fuel in the country during the last five years;
- (b) the year-wise/category-wise comparative prices of fuel in the country in reference to global crude oil prices;
- (c) the revenue earned by the union and the States from the sale of fuel in the country during the last five years, the year-wise/category-wise details thereof; and
- (d) whether the Government has taken any initiative to further decrease the prices of fuel and if so, the details thereof?

## ANSWER

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũालय मŐ राǛ मंũी ( ŵी सुरे श गोपी )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI SURESH GOPI)

(a) to (d): Prices of petrol and diesel are market determined and Public Sector Oil Marketing Companies (OMCs) take appropriate decision on pricing of petrol and diesel.

India  imports  more  than  85%  of  its  crude  oil  requirements.  Crude  oil  prices  (Indian  basket) increased from $59.35/bbl (August 2019)  to $112.87/bbl (March  2022)  and further to $116.01/bbl (June 2022) and have continued to remain highly volatile.

Central Government reduced Central Excise duty by a total of Rs. 13/litre and Rs. 16/litre on petrol and diesel respectively in two tranches in November 2021 and May 2022, which was fully passed on to consumers. Some State Governments also reduced state VAT rates to provide relief to citizens. In March, 2024, OMCs also reduced the retail prices of petrol and diesel by Rs. 2 per litre  each  and  current  RSP  of  petrol  and  diesel  at  Delhi  is  Rs.  94.72  and  Rs.  87.62  per  litre respectively.

Government  of  India  also  took  several  other  steps  to  insulate  common  citizens  from  high international  prices,  which  included  diversifying  the  crude  import  basket,  windfall  taxes  on export of petroleum products, invoking the provisions of Universal Service Obligation to ensure availability of petrol & diesel in domestic market, increasing the blending of ethanol in petrol, etc.

India imports about 60% of its domestic LPG consumption. Prices of LPG in the country are linked to its price in the international market. Government continues to modulate the effective price to consumer for domestic LPG. During the period 2020-21 to 2022-23, the average Saudi CP  (international  benchmark  for  LPG  pricing)  went  up  from  $415  per  MT  to  $712  per  MT. However, the increase in the international prices was not fully passed on to the customers.

Under PAHAL Scheme, the domestic LPG cylinders are sold at non-subsidised price and the applicable subsidy to the consumers is transferred directly into their bank accounts. Apart from the direct subsidy to consumers, the OMCs have also been compensated Rs 22,000 crore in FY 2022-23 by Government of India to cover the under-recoveries suffered by them in not passing on the high international LPG prices to the domestic LPG consumers.

W.e.f. 21 st May, 2022, Government has been providing a targeted subsidy of Rs. 200 per 14.2 Kg LPG cylinder for Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries for upto 12 refills a year. Government reduced the retail selling price of domestic LPG by Rs. 200 per 14.2 Kg LPG cylinder with effect from 30 th August, 2023. Moreover, w.e.f.  5 th October, 2023, Government increased  the  targeted  subsidy  to  Rs.  300  per  14.2  Kg  LPG  cylinder  for  all  Pradhan  Mantri Ujjwala Yojana (PMUY) beneficiaries. Government further reduced the RSP of domestic LPG by Rs. 100 per 14.2 Kg cylinder w.e.f. 9 th March, 2024.

The current RSP of domestic LPG at Delhi is Rs. 803 per 14.2 Kg cylinder. With a targeted subsidy of Rs. 300 per cylinder (and proportionately prorated for 5 Kg cylinder), effective cost for PMUY consumers is Rs. 503 per 14.2 Kg cylinder (at Delhi) currently.

The  details  of  yearly  average  of  Indian  Basket  of  Crude  Oil,  Retail  Selling  Prices  of  Petrol, Diesel and domestic LPG (Rs/14.2kg cyl) at Delhi since 2019-20 are given at Annexure-I.

The  details  of  contribution  of  petroleum  sector  to  exchequer  since  2019-20  are  given  at Annexure-II.

Annexure referred to in reply to Lok Sabha Unstarred Question No. 2884 asked by Shri Satpal Brahamchari to be answered on 08.08.2024 regarding 'Increase in Price of Fuel'.

| F.Y.                      |   Indian Basket of Crude Oil ($/bbl) |   RSP of Petrol (Rs./Ltr) |   RSP of Diesel (Rs./Ltr) |   RSP of domestic LPG (Rs/14.2kg cyl)* |
|---------------------------|--------------------------------------|---------------------------|---------------------------|----------------------------------------|
| 2019-20                   |                                60.47 |                     72.69 |                     65.78 |                                 688.03 |
| 2020-21                   |                                44.82 |                     80.84 |                     73.58 |                                 650.8  |
| 2021-22                   |                                79.18 |                     98.05 |                     87.42 |                                 866.85 |
| 2022-23                   |                                93.15 |                     97.9  |                     90.58 |                                1038.7  |
| 2023-24                   |                                82.58 |                     96.63 |                     89.53 |                                 979.23 |
| 2024-25 (Till 31.07.2024) |                                84.96 |                     94.72 |                     87.62 |                                 803    |

Source: Petroleum Planning & Analysis Cell (PPAC)

* W.e.f. 21 st May, 2022, Government has been providing a budgetary support for targeted subsidy of Rs. 200 per 14.2 Kg LPG cylinder for Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries for upto 12 refills a year for years 2022-23 and 2023-24. Moreover, w.e.f.  5 th October, 2023, the targeted subsidy increased to Rs. 300 per 14.2 Kg LPG cylinder for all Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries.

Annexure referred to in reply to Lok Sabha Unstarred Question No. 2884 asked by Shri Satpal Brahamchari to be answered on 08.08.2024 regarding 'Increase in Price of Fuel'.

## Contribution of petroleum sector to exchequer

(Rs. in Crore)

| F.Y.        | Contribution to Central Exchequer   | Contribution to State Exchequer   | Total Contribution of Petroleum Sector to Exchequer   |
|-------------|-------------------------------------|-----------------------------------|-------------------------------------------------------|
| 2019-20     | 3,34,315                            | 2,21,056                          | 5,55,370                                              |
| 2020-21     | 4,55,069                            | 2,17,650                          | 6,72,719                                              |
| 2021-22     | 4,92,303                            | 2,82,122                          | 7,74,425                                              |
| 2022-23     | 4,28,067                            | 3,20,651                          | 7,48,718                                              |
| 2023-24 (P) | 4,32,394                            | 3,18,762                          | 7,51,156                                              |

The above is based on data provided to Petroleum Planning and Analysis Cell (PPAC) by 15 major oil & gas  companies.  The  amount  reported  by  the  companies  to  PPAC  is  the  consolidated  amount  of  all taxes/cess/ duties /GST etc. for crude oil and petroleum products.

Figures may vary slightly due to round off.

(P) - Provisional