Wednesday, April 12, 2017

Query on Dynamic Fuel Pricing

Just saw an article on the internet that the petrol and diesel prices will be revised daily. In other words, dynamic fuel pricing is to be introduced in India. For the time being on a trial basis of course. Link - http://profit.ndtv.com/news/economy/article-in-5-cities-first-petrol-diesel-prices-will-change-daily-says-report-1680298

After reading the article, a few doubts came to my mind immediately
  1. How will the consumer know that the price being charged by the petrol station is correct?
  2. How can the consumer know what is the daily price? Will we get daily updates in newspapers? All of us cannot access internet daily. Also, if we get information through internet, not all of us have mobile phones or places with stable mobile network to receive SMS
  3. Once the consumer knows what is the price, how can he ensure that the price made available to him is correct?
  4. Imagine people who are travelling to other states via road be it own vehicle or hired, and they have to fill up their car from such other state, they have to go by what the petrol pump people say.
  5. Take into consideration that a change in Re. 0.01 by a pump owner, he can make thousands or lakhs in a day (based on the location and volume of sales) at the cost of common man
  6. How can the consumer know that the increase or decrease (We don’t believe that there will be a decrease) applied is correct?
  7. How can we ascertain that the central and state levies have been applied correctly?
  8. Will the oil marketing companies (both public and private) disclose their cost of procurement of crude, which includes the currency exchange rate applied, cost of conversion into final product and all other attributable cost in public domain so that people can compute the price?
  9. Even if the companies provide the details (I don’t think they will), we cannot sit and compute the prices daily. Don’t we have our regular work to do?
  10. What probable loopholes has the Government identified and what are the proposed control measures identified to plug those loopholes?
One thing is certain, we can expect daily arguments and fights in petrol pumps. Expect total chaos.