Petrol Price Flare-up: Oil Tax Revenues To Odisha's Kitty Up 269% in 3-yrs!

Bhubaneswar: With the international crude oil prices having crossed the fifty dollars per barrel mark in January, the petrol price flare-up since then has singed the common man on streets. Odisha’s Capital city is now in the top-10 cities having the highest petrol price in the country.

The petrol prices in Bhubaneswar today is quoted at Rs 86.74/litre, which is eight highest among major cities in the country. The chart is led by Jaipur (Rajasthan) and is closely followed by Mumbai. The rate today in Jaipur stood at Rs 94.14/litre. Among the neighbouring states, the prices of petrol in Kolkata and Patna are higher than Bhubaneswar.

As per the data available with the Petroleum Ministry, Odisha has the 2nd highest per capita petrol consumption in eastern India. Andaman and Nicobar Island top the chart. The per capita consumption in Odisha has been estimated at around 15 kg, whereas it is around 21 kg in A & N Island.

PETROL FLARE-UP: ODISHA IMPACT

As per a study published in 2018 in Atmospheric Environment, Odisha is 16^th in the country in petroleum fuel consumption (including diesel). The consumption in Odisha is based on the traffic volume in the State. The study has estimated the traffic volume for Odisha by multiplying the vehicle population in the state with the annual vehicle distance travelled (in km).

PETROL PRICE DYNAMICS

The international oil price on January 1, 2021, stood at $52 per barrel. And the Indian currency exchange rate with dollar stood at Rs 73.09 per US dollar. Therefore, the Crude oil in Indian currency is estimated at Rs 3,801. The value of petrol price after processing is estimated at Rs 27.74 per litre.

But the consumers on road here have to pay Rs 86.74 per litre. The petro price gets jacked up by a host of taxes. While Central taxes together amount to Rs 32.98/litre, Odisha levies a tax of another around Rs 21/ litre. In addition to the taxes, the commission to petrol pump dealers amounts to Rs 3.67/litre.

OIL REVENUE FOR ODISHA

Both the Centre and State strike rich with the oil. The data available with the Petroleum Ministry shows that Odisha’s revenue from petrol and diesel has grown by 269 per cent during the period of 2017-20. As per the provisional data available for the first half of the current financial year 2020-21, the revenue realised by State government stood at a whopping Rs 71 crore. The State is among the top-10 states in the country, where taxes on petrol and diesel contribute nearly Rs 200 crore to the states’ kitty.

The Union Government has collected Rs 3,343 billion from excise duty on petrol alone in 2019-20. The petro coffers had risen by 94 per cent during the period 2014-20.

RESPITE FORTHCOMING?

There seems no respite in sight from oil price flare-up. As per US Energy Information Administration's (EIA) Short-Term Energy Outlook released on January 12, 2021, the international crude oil prices will rise to $53 per barrel in 2021.

Since the oil has turned out to be a golden egg for both the Centre and the State, the common has to pay through his/her nose.

All hopes of respite now rest heavily on the upcoming Union and State budgets in February.