Why BioDiesel Prices Are Rising
Updated: Jan 17
What are the reason behind growing rates of bio diesel ? there are several reasons for rising cost of bio diesel B100 and import material.
Rising global crude oil prices and an improved demand outlook for petroleum products due to the prospects of a viable vaccine for Covid-19 are the key reasons behind the recent rise in the prices of petrol and diesel, according to experts.
The price of Brent crude has risen to almost $49 per barrel, its highest level since early March 2020. The price of Brent crude crashed from $66 per barrel at the beginning of the year to $19 per barrel in April due to global restrictions on travel as countries shut down to control the transmission of the novel corona virus.
Since India imports most of the fuel required to meet its demands, the price of fuels rises in tandem with global prices. Domestic prices of petrol and diesel are revised by oil marketing companies based on changes in the international prices of petrol and diesel.
However, as global crude prices crashed and India went into lockdown, Indian OMCs stopped revising the prices of petrol and diesel for over 80 days.
“Globally crude oil prices have been moving up. The improvement in the demand outlook due to the improving prospects of a vaccine has been reflected in a widening of cracks for petrol and diesel,” said Vivekanand Subbaraman, analyst at Ambit Capital. He noted that the impact of the recent rise in crude oil prices had likely been incorporated through recent price hikes.
But why are prices higher even though crude is still cheaper than at the beginning of the year?
The central government and a number of state governments have significantly increased the duties on petrol and diesel as a way to boost revenues since the Covid-19 related lockdown severely curtailed economic activity.
This has led to the current price of petrol nearing price levels of October 2018, when the per-barrel cost of India’s crude basket hit $80.
State and central taxes currently account for around 62% of the retail price of petrol and around 57.5% of the retail price of diesel in Delhi.
The central government has increased the excise duty on petrol to Rs 32.98 per litre from Rs 19.98 and at the beginning of the year, and increased the excise duty on diesel to Rs 31.83 per litre from Rs 15.83 over the same period.
Many states, including, Delhi, Maharashtra, Tamil Nadu, and Karnataka have also hiked state levies on petrol and diesel since the beginning of the fiscal to boost revenues.
(Information Guided From TheIndianExpress)
Today's rate of petrol 88.22 and diesel rates are 87.64 in Gujarat. it is directly affect to the bio diesel industries, due to diesel and petrol price rising, user are turning to bio diesel and demand more then usual.
stokes of bio diesel is less then industries needs, raw materials are being expensive due of it's growing demand. bio diesel's rate are not more factual then diesel, even it affect the bio diesel industries to provide materials and maintain current situation of demands.