Lok Sabha Question No. 2511 (UNSTARRED), answered on 2015-12-14
Subject: Price of Petroleum Products
Ministry: PETROLEUM AND NATURAL GAS
Asked by: SANJAY SHAMRAO DHOTRE, C. MAHENDRAN, MALLIKARJUN  KHARGE, PARAYAMPARANBIL KUTTAPPAN BIJU, SUSHMITA DEV, VIRENDRA  KUMAR, BHARTRUHARI MAHTAB, GOPAL CHINAYYA SHETTY, JYOTIRADITYA MADHAVRAO SCINDIA, PR. SENTHILNATHAN, M. B. RAJESH, VIJAY KUMAR S.R., OM BIRLA, ELUMALAI VELLAIGOUNDER, P.R. SUNDARAM

## LOK SABHA

## UNSTARRED QUESTION NO. 2511 TO BE ANSWERED ON 14 TH  DECEMBER, 2015

## PRICE OF PETROLEUM PRODUCTS

## 2511. SHRI SANJAY DHOTRE:

SHRI C. MAHENDRAN:

SHRI MALLIKARJUN KHARGE:

SHRI P.K. BIJU:

KUMARI SUSHMITA DEV:

DR. VIRENDRA KUMAR:

SHRI BHARTRUHARI MAHTAB:

SHRI GOPAL SHETTY:

SHRI JYOTIRADITYA M. SCINDIA:

SHRI PR. SENTHIL NATHAN:

SHRI M.B. RAJESH:

SHRI S.R. VIJAYAKUMAR:

SHRI OM BIRLA:

SHRI ELUMALAI V.:

SHRI P.R. SUNDARAM:

## isVªksfy;e vkSj izkÑfrd xSl ea=h

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

- (a) the details of the criteria/policy to fix petroleum products prices in the country along with the increase/decrease in the prices of petroleum products during each of the last two years and the current year, product-wise including petrol, diesel, CNG, LPG, ATF and kerosene;
- (b) the details of the prices of crude oil in the international market during the said period and  the  reasons  for  not  passing  the  full  benefits  of  declining  prices  of  crude  oil  in international market to consumers of petroleum products, product-wise including petrol, diesel, LPG, CNG, ATF and kerosene etc. along with its likely impact on poor and prices of essential commodities;
- (c) whether the huge drop in the crude oil prices helped the exchequer and oil companies to save more money from the oil subsidy account including margin improvement and less under/over-recoveries to the Oil Marketing Companies (OMCs)/upstream companies;
- (d) if so, the details thereof along with subsidy/cash assistance given by the Government to  the  OMCs/upstream companies including profit/loss earned by them during the said period,  and  evolve  a  Mechanism  of  Subsidy  sharing  formula  OMC/company/productwise including LPG and kerosene; and
- (e) whether the Government proposes to set up a price stabilisation fund in order to meet the challenges of any possible price rise of crude oil in international market in future and if so, the details thereof?

## ANSWER

## isVªksfy;e vkSj izkÑfrd xSl ea=h ( Lora= izHkkj ) ¼Jh /keZsUnz iz/kku½

MINISTER OF STATE (I/C) IN THE MINISTRY OF PETROLEUM AND NATURAL GAS

(a)&(b):      Prices  of  all  petroleum  products,  except  PDS  Kerosene  and  Subsidized Domestic LPG, are deregulated and the Public Sector Oil Marketing Companies (OMCs) take their own decision  in line with international product prices and market conditions. The international oil prices started sliding after July 2014. Retail Selling Price of Petrol which was Rs.73.60 per litre (at Delhi) in July, 2014 has reduced by Rs. 13.12 per litre. Since then, the OMCs have reduced the price of Petrol nineteen times and the current Retail price at Delhi is Rs. 60.48 per litre.  Similarly the Retail Selling Price of Diesel in October 2014 was 58.97 per litre (at Delhi) which has reduced by Rs. 12.42 per litre and the  current  Retail  Selling  Price  is  Rs.  46.55  per  litre.   The  price  of  Diesel  has  been reduced 15 times since deregulation of the price of Diesel. The Indian Basket of Crude oil during  the  corresponding  period  has  declined  by  Rs.  24.92  per  litre  [June  2014  (2nd fortnight  average)  to  November  2015  (2nd  fortnight  average)].    However,  in  order  to protect the consumers from the fluctuations in the prices in the international market, the Government continued to modulate the retail selling price of Domestic LPG. After launch of DBTL, its consumers get the LPG cylinders at market price and receive LPG subsidy directly into their bank accounts.

The details of price of Petrol, Diesel, Domestic LPG, ATF & PDS Kerosene and crude  oil  during  last  two  years  and  current  year  are  given  at Annexure-I  and  II respectively.

Price  of  CNG  is  fixed  by  the  concerned  City  Gas  Distribution  (CGD)  entities under the Petroleum & Natural Gas Regulatory Board (PNGRB) Act, 2006.

(c) & (d): Reduction  in international oil prices results in reduction of  underrecovery/  subsidy  burden  of  the  Government  on  sale  of  PDS  Kerosene  and  Domestic LPG.    However,  the  reduction  in  price  of  crude  oil  in  the  international  oil  markets reduces the realization on sales of crude by the upstream oil companies.

The Public Sector Oil Marketing Companies (OMCs) purchase crude oil based on prices in international markets. Price of finished products in India is also linked to their price in the international markets. Some OMCs have also reported inventory losses as a result of the fall in the international prices.

The  details  of  the  amount  of  subsidy/under  recovery  on  sale  of  Diesel  (upto 18.10.2014), Subsidized Domestic LPG and PDS Kerosene during 2013-14 to 2015-16 (April  to  September)  and  compensation  provided  by  Government  and  upstream  oil companies under Burden Sharing Mechanism thereon is as follows:

Rs. Crore

| Total                       | Particulars                 | 2013-14 2014-15             | 2015-16 (April - September)   |
|-----------------------------|-----------------------------|-----------------------------|-------------------------------|
| Diesel                      | 62,837                      | 10,935                      | 0                             |
| PDS Kerosene                | 46,458                      | 24,799                      | 7,122                         |
| Domestic LPG *              | 34,412                      | 40,551                      | 8,814                         |
| Under-recoveries (A)        | 1,43,707                    | 76,285                      | 15,936                        |
| Sharing of under-recoveries | Sharing of under-recoveries | Sharing of under-recoveries | Sharing of under-recoveries   |
| Share of Government*        | 74,609                      | 31,279                      | 13,949                        |
| Share of Upstream Companies | 67,021                      | 42,822                      | 1,980                         |

| Share of OMCs   | 2,077    | 2,184   | 7      |
|-----------------|----------|---------|--------|
| Total           | 1,43,707 | 76,285  | 15,936 |

* Includes subsidy under DBTL Scheme.

Further, the profit reported by the OMCs and upstream companies oil during 201314, 2014-15 and 2015-16 (April -September) is given below:

Rs. crore

| Companies                      | 2013-14                        | 2014-15                        | 2015-16 (April - September)   |
|--------------------------------|--------------------------------|--------------------------------|-------------------------------|
| Downstream oil companies/ OMCs | Downstream oil companies/ OMCs | Downstream oil companies/ OMCs |                               |
| IOC                            | 7019                           | 5273                           | 6107                          |
|                                | 1734                           | 2733                           | HPC 1268                      |
| BPC                            | 4061                           | 5085                           | 3394                          |
| Upstream Companies             | Upstream Companies             | Upstream Companies             |                               |
| ONGC                           | 22095                          | 17733                          | 10302                         |
| OIL                            | 2981                           | 2510                           | 1450                          |

(e): At present, there is no such proposal before the Government.

x-x-x-x-x

Annexure  referred  to  in  reply  to  parts  (a)&(b)  of  Lok  Sabha  Unstarred  Question  No.2511 asked by Shri Sanjay Dhotre, Shri C. Mahendran, Shri Mallikarjun Kharge, Shri P.K. Biju, Kumari Sushmita Dev, Dr. Virendra Kumar, Shri Bhartruhari Mahtab, Shri Gopal Shetty, Shri Jyotiraditya M.  Scindia, Shri Pr. Senthil Nathan, Shri M.B.  Rajesh, Shri S.R. Vijayakumar, Shri Om Birla, Shri Elumalai V. and Shri P.R. Sundaram to be answered on 14 th December, 2015 regarding 'Price of Petroleum Products'

Revision in RSP of Petroleum Products since 1.4.2013 at Delhi

|            |             | Diesel      | PDS Kerosene   | Domestic LPG       | Domestic LPG       | Reason                                                                           |
|------------|-------------|-------------|----------------|--------------------|--------------------|----------------------------------------------------------------------------------|
| Date       | Petrol      |             |                | Subsidized         | Non- Subsidized    |                                                                                  |
|            | (Rs./litre) | (Rs./litre) | (Rs./litre)    | (Rs./14.2 Kg Cyl.) | (Rs./14.2 Kg Cyl.) |                                                                                  |
| 01.04.2013 | 68.31       | 48.63       | 14.96          | 410.50             | 901.50             | Revision in siding charges / Reduction in price of non - subsidized domestic LPG |
| 02.04.2013 | 67.29       |             |                |                    |                    | Reduction in prices                                                              |
| 16.04.2013 | 66.09       | 48.67       |                |                    |                    | Reduction in Petrol prices/ Reduction in delivery charges of                     |
| 01.05.2013 | 63.09       |             |                |                    | 847.00             | Diesel Reduction in prices                                                       |
| 11.05.2013 |             | 49.69       |                |                    |                    | Increase in price                                                                |
| 01.06.2013 | 63.99       | 50.25       |                |                    | 802.00             | Increase (petrol and diesel) / reduction (non-sub. Dom LPG) in prices            |
| 16.06.2013 | 66.39       |             |                |                    |                    | Increase in price                                                                |
| 29.06.2013 | 68.58       |             |                |                    |                    | Increase in price &delivery charges of Petrol                                    |
| 01.07.2013 |             | 50.26       |                |                    | 832.00             | Increase in Delivery charges of HSD / Increase in Price of Non Sub. Dom. LPG     |
| 02.07.2013 |             | 50.84       |                |                    |                    | Increase in Price                                                                |
| 15.07.2013 | 70.44       |             |                |                    |                    | Increase in Price                                                                |
| 01.08.2013 | 71.28       | 51.40       |                |                    | 875.00             | Increase in Prices                                                               |
| 01.09.2013 | 74.10       | 51.97       |                |                    | 932.50             | Increase in Prices                                                               |
| 14.09.2013 | 76.06       |             |                |                    |                    | Increase in Price                                                                |
| 01.10.2013 | 72.40       | 52.54       |                |                    | 1004.00            | Increase (Diesel &Non Sub. Dom. LPG)/ Reduction (petrol) in                      |
| 01.11.2013 | 71.02       | 53.10       |                |                    | 954.50             | Price Increase (Diesel)/ Reduction (petrol &Non Sub. Dom. LPG) in                |
| 01.12.2013 |             | 53.67       |                |                    | 1017.50            | Price Increase in prices                                                         |
| 11.12.2013 |             |             |                | 414.00             | 1021.00            | Increase in distributor commission of LPG                                        |
| 21.12.2013 | 71.52       | 53.78       |                |                    |                    | Increase in price of Petrol& Increase in Dealer commission on Petrol and Diesel  |
| 01.01.2014 |             |             |                |                    | 1241.00            | Increase in prices                                                               |
| 05.01.2014 | 72.43       | 54.34       |                |                    |                    | Increase in prices                                                               |

|            |             |             | PDS         | Domestic LPG       | Domestic LPG       | Reason for revision                                                                      |
|------------|-------------|-------------|-------------|--------------------|--------------------|------------------------------------------------------------------------------------------|
| Date       | Petrol      | Diesel      | Kerosene    | Subsidized         | Non- Subsidized    |                                                                                          |
|            | (Rs./litre) | (Rs./litre) | (Rs./litre) | (Rs./14.2 Kg Cyl.) | (Rs./14.2 Kg Cyl.) |                                                                                          |
| 01.02.2014 |             | 54.91       |             |                    | 1134.00            | Increase (Diesel)/ Reduction (Non Sub. Domestic LPG) in Price                            |
| 01.03.2014 | 73.16       | 55.48       |             |                    | 1080.50            | Increase (Petrol &Diesel)/ Reduction (Non Sub. Domestic LPG) in Price                    |
| 01.04.2014 | 72.26       | 55.49       |             |                    | 980.50             | Reduction in Prices (Petrol& Non Sub. Domestic LPG)/ Increase in delivery chg. of Diesel |
| 16.04.2014 | 71.41       |             |             |                    |                    | Reduction in price                                                                       |
| 01.05.2014 |             |             |             |                    | 928.50             | Reduction in Price                                                                       |
| 13.05.2014 |             | 56.71       |             |                    |                    | Increase in price                                                                        |
| 01.06.2014 |             | 57.28       |             |                    | 905.00             | Increase (Diesel)/ Reduction (Non Sub. Dom. LPG) in price                                |
| 07.06.2014 | 71.51       |             |             |                    |                    | Increase in Price                                                                        |
| 25.06.2014 | 71.56       |             |             |                    |                    | Increase in rail freight                                                                 |
| 01.07.2014 | 73.60       | 57.84       |             |                    | 922.50             | Increase in Prices                                                                       |
| 01.08.2014 | 72.51       | 58.40       |             |                    | 920.00             | Increase (Diesel)/ Reduction (petrol &Non Sub. Dom. LPG) in                              |
| 16.08.2014 | 70.33       |             |             |                    |                    | Price Reduction in price                                                                 |
| 31.08.2014 | 68.51       | 58.97       |             |                    |                    | Increase (Diesel)/ Reduction (Petrol) in Price                                           |
| 01.09.2014 |             |             |             |                    | 901.00             | Reduction in price                                                                       |
| 01.10.2014 | 67.86       |             |             |                    | 880.00             | Reduction in price                                                                       |
| 15.10.2014 | 66.65       |             |             |                    |                    | Reduction in price                                                                       |
| 19.10.2014 |             | 55.60       |             |                    |                    | Reduction in price                                                                       |
| 23.10.2014 |             |             |             | 417.00             | 883.50             | Increase in Distributor Commission                                                       |
| 01.11.2014 | 64.24       | 53.35       | 15.14*      |                    | 865.00             | Reduction in prices/ Price of PDS Kerosene as per Mumbai                                 |
| 01.12.2014 | 63.33       | 52.51       |             |                    | 752.00             | Reduction in prices                                                                      |
| 16.12.2014 | 61.33       | 50.51       |             |                    |                    | Reduction in prices                                                                      |
| 01.01.2015 | 61.33       | 50.51       |             |                    | 708.50             | Reduction in prices                                                                      |
| 17.01.2015 | 58.91       | 48.26       |             |                    |                    | Reduction in prices                                                                      |
| 01.02.2015 |             |             |             |                    | 605.00             | Reduction in price                                                                       |
| 04.02.2015 | 56.49       | 46.01       |             |                    |                    | Reduction in prices                                                                      |
| 16.02.2015 | 57.31       | 46.62       |             |                    |                    | Increase in prices                                                                       |
| 01.03.2015 | 60.49       | 49.71       |             |                    | 610.00             | Increase in prices                                                                       |

|            |             |             |             | Domestic LPG      | Domestic LPG                        | Reasons                                                                                           |
|------------|-------------|-------------|-------------|-------------------|-------------------------------------|---------------------------------------------------------------------------------------------------|
| D at e     | Petrol      | Diesel      | PDS SKO     | RSP               | Effective Price after DBTL Subsidy# | Reasons                                                                                           |
|            | (Rs./litre) | (Rs./litre) | (Rs./litre) | (Rs./14.2 KGCyl.) | (Rs./14.2 KGCyl.)                   | Reasons                                                                                           |
| 01.04.2015 | 60.00       | 48.50       |             | 621.00            | 417.82                              | Increase (Non-Subsidized Domestic LPG)/ Reduction (MS &HSD) in prices                             |
| 16.04.2015 | 59.20       | 47.20       |             |                   |                                     | Reduction in prices                                                                               |
| 1.05.2015  | 63.16       | 49.57       | 15.24       | 616.00            |                                     | Increase (MS, HSD &PDS SKO) / Reduction (Domestic LPG) in prices                                  |
| 16.05.2015 | 66.29       | 52.28       |             |                   |                                     | Increase in prices                                                                                |
| 01.06.2015 |             |             |             | 626.50            |                                     | Increase in price                                                                                 |
| 16.06.2015 | 66.93       | 50.93       |             |                   |                                     | Increase (MS) / Reduction (HSD) in prices                                                         |
| 01.07.2015 | 66.62       | 50.22       |             | 608.50            |                                     | Reduction in prices                                                                               |
| 16.07.2015 | 66.90       | 49.72       |             |                   |                                     | Reduction in price &increase in VAT rates at Delhi                                                |
| 01.08.2015 | 64.47       | 46.12       |             | 585.00            |                                     | Reduction in prices                                                                               |
| 15.08.2015 | 63.20       | 44.95       |             |                   |                                     | Reduction in prices                                                                               |
| 01.09.2015 | 61.20       | 44.45       |             | 559.50            |                                     | Reduction in prices                                                                               |
| 01.10.2015 |             | 44.95       |             | 517.50            |                                     | Increase (Diesel)/ Reduction (Domestic LPG) in price                                              |
| 16.10.2015 |             | 45.90       |             |                   |                                     | Increase in prices                                                                                |
| 01.11.2015 | 60.70       | 45.93       |             | 545.00            |                                     | Decrease (Petrol) / Increase (Dom. LPG) in price / Increase in delivery charges of Petrol& Diesel |
| 16.11.2015 | 61.06       | 46.80       |             |                   |                                     | Increase in prices                                                                                |
| 01.12.2015 | 60.48       | 46.55       |             | 606.50            |                                     | Decrease (Petrol &Diesel) / Increase (Dom. LPG) in price                                          |
|            | 60.48       | 46.55       | 15.24*      | 606.50            | 417.82#                             | Current RSP                                                                                       |

Note - Prices of Petrol since 26.6.2010, Non Subsidized Domestic LPG since  13.9.2012 and Diesel since 19.10.2014 are as per IOCL.

*Since there is 'Nil' allocation of PDS Kerosene in Delhi currently, RSP of PDS Kerosene 1.11.2014 onwards is at Mumbai.

# effective 1 st Jan 2015, Modified DBTL scheme has been implemented in entire country.

Annexure referred to in reply to parts (a)&(b) of Lok Sabha Unstarred Question No.2511  asked  by  Shri  Sanjay  Dhotre,  Shri  C.  Mahendran,  Shri  Mallikarjun Kharge,  Shri  P.K.  Biju,  Kumari  Sushmita  Dev,  Dr.  Virendra  Kumar,  Shri Bhartruhari  Mahtab,  Shri  Gopal  Shetty,  Shri  Jyotiraditya  M.  Scindia,  Shri  Pr. Senthil  Nathan,  Shri  M.B.  Rajesh,  Shri  S.R.  Vijayakumar,  Shri  Om  Birla,  Shri Elumalai  V.  and  Shri  P.R.  Sundaram  to  be  answered  on  14 th December,  2015 regarding 'Price of Petroleum Products'

## Indian Basket Crude Oil Prices

($/bbl)

|           | 2013   |   2014 | 2015   |
|-----------|--------|--------|--------|
| January   | -      | 105.29 | 46.59  |
| February  | -      | 106.19 | 56.43  |
| March     | -      | 105.3  | 55.18  |
| April     | 101.57 | 105.56 | 59.07  |
| May       | 101.10 | 106.85 | 63.82  |
| June      | 101.11 | 109.05 | 61.75  |
| July      | 104.86 | 106.3  | 56.30  |
| August    | 108.45 | 101.89 | 47.33  |
| September | 109.47 |  96.96 | 46.10  |
| October   | 107.37 |  86.83 | 46.68  |
| November  | 106.55 |  77.58 | 42.50  |
| December  | 108.72 |  61.21 | 40.16* |

Note - The Indian basket of Crude Oil (for 2015-16) represents a derived basket comprising of Sour grade (Oman & Dubai average) and Sweet grade (Brent Dated) of Crude oil processed in Indian refineries in the ratio of 72.28:27.72 during 2014-15