Enhanced petrol prices to shift demand towards diesel cars

Starting from June 25 2010, a hike of Rs. 9 per litre is observed in the petrol prices owing to various situations and govt policies. With this hike the consumption of petrol has nor reduced rather has grown up by striking 15 per cent since past 6 months which is a failure to all political strikes and protests.

As per the statements made by an official from oil sector, consumers are adjusting to these increased petrol prices and the concern is that it might result in preference to diesel engine cars which will lead to lopsided demand. The concern is big for the refining trio of Indian Oil, Hindustan Petroleum Corporation and Bharat Petroleum Corporation. The refiners are worried for over use of diesel cars in Indian auto market as diesel constitute 60% of their fuel losses as against 20% in case of petrol.

As per the figures shown by BPCL, HPCL and IOC a loss of Rs. 40,000 crore is expected in sale of kerosene, LPG and diesel in the second half of this financial year. The loss associated with diesel alone amounts to Rs 25,000 crore and the concern is that the consumption in non auto sector is increasing day by day.

The increase in petrol prices from December 2010 has forced people to look for better alternatives and the best option left is nothing else but switching to diesel engine vehicles. The fact is evident from ample of queries dealers are facing on LPG and diesel running vehicles.

The dealers are reporting an increase trend in the queries and public interest on diesel and LPG vehicles which solves their purpose of cheap fuel. The dealers have also reported a great demand of diesel variants introduced in existing famous models. The increased petrol price have also forced the customers to look forward for dealers which are authorised by Govt to deal in the LPG car kits.

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