Thursday 7 November 2013

Oil Ministry wants govt to cut duties on branded diesel, petrol

With an aim to cut the country’s fuel consumption and to enhance the fuel efficiency, oil ministry has recently asked the government to cut duties on branded petrol and diesel that offer better mileage. The move will help to cut down the prices of branded fuels leading to attract consumers to opt for branded fuels, which will help improve the fuel efficiency by about 2 percent, resulting in reduction in overall demand for petroleum products.

Oil marketing companies had launched specialised products (branded petrol and diesel) to enhance the fuel efficiency of new generation vehicles. Presently, the government levies higher excise duty on premium or branded petrol and diesel, which make them costlier than the normal or unbranded auto fuel. Earlier, in September, the government also withdrew the subsidy support for branded fuels resulting in further downward slide. Currently unbranded petrol is cheaper by around Rs 10, while, unbranded diesel is discounted by Rs 15 a litre from their branded versions. 

Oil ministry has also launched a ‘Nationwide Mega Campaign’ from October 1 to conserve petroleum products through reducing consumption of key petroleum products and minimizing wastage through simple fuel saving measures. The ministry is of the view that the move is a vital step towards demand side management with an saving potential of up to 3 per cent of petroleum  products, equivalent to approximately Rs16,000 crore in one year. In other initiatives to increase fuel efficiency, the Petroleum Conservation Research Association (PCRA) and Bureau of Energy Efficiency (BEE) have jointly formulated an ambitious programme on fuel efficiency covering domestic LPG stoves and agriculture diesel pump sets.

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