Thursday, June 5, 2008

Mystry of Oil in India

I don't understand much about oil business so I am not able to understand when different parties come up with different logic on why the price of petrol should be raised and why it should not be raised. After googling, here is some data that I found.

BarrelGallonsLitresPercentage of productsCost per litre
Heating Oil2.7010.226.05%1.86
Heavy Fuel Oil1.706.443.81%1.17
Jet Fuel4.1015.529.19%2.83
Other Products7.4028.0116.59%5.11
Processing Gain2.609.845.83%1.80

So it seems every barrel (42 gallons) of crude produces different quantities of actual products like petrol and diesel. Now taking following numbers as indicative.


If one looks at numbers, for producing one liter of petrol, the raw material component only costs Rs. 13.40 at the current crude prices.

Now assuming that other components have only marginally increased and the primary factor in the increase of petrol is the price of crude, the current prices just don't make sense. Because the even if the price of crude has trebled, it is still capped at Rs. 13.40.

I am trying to get other data like the refining cost, marketing cost, taxes etc to make sense of Rs. 50+ of petrol price but the data is not very readily available.

If anybody has the data, give me and I will further do number crunching

No comments:

Post a Comment