Dynamic Gasoline Prices- Living in a world of Volatile Market

-Forces people to fall in love with crude prices, USA and the Middle East

-Need of Dynamic prices for essential Commodities???

-Negative impact on Automobile Industries in long run

-Dynamic Transportation cost/Freight cost/Travel cost???

No doubt, people of the country would start falling in love with the international Oil
market very soon, more specifically with crude benchmark prices. Every Day people
would start looking at daily price changes at stock exchanges. Even people would
be more analytical in their approach in day today life, than ever before.

Thanks to 4G network service providers, who offer data packages at competitive

prices. This would facilitate people to track minute prices of crude Oil.

Lets have a look at the status of oil imports in India. India imports 70%-80% crude
oil from different countries. About 58% of crude oil is imported from the Middle East.
Considering petroleum product demand, domestic crude production capacity and
refining capacity expansion, it is expected that the country is likely to import about
90% of crude from different crude suppliers.

It is true that India mostly depends on Crude Oil (28%), next to Coal and the
prominence of crude oil is not likely to change anytime soon in the energy mix.

International Crude Price Vs. Petrol Price in India

C C C C C C C C C C1
C11
Description 1 2 3 4 5 6 7 8 9 0
International Price of Crude Oil with
5 5 6 6 7 7 8 8 9
Ocean Freight 95 100
3 5 0 5 0 5 0 5 0
(as on 1st April 2017) (USD/BBL)
Final Retail Petrol Price as on 1st 6 6 6 7 7 7 7 7 8
83 85
April 2017 (INR/Litre)* 6 7 9 1 3 5 7 9 1
*Note: Calculation done for Delhi
Here we will see some economic areas, which are affected by crude price changes.
Here oil price increase scenario has been discussed.

Healthcare

Petroleum is a major component for many medical products, including medicine

filing cabinet, and medicines. People would start loving to pay more as the prices of
crude go on rising. Vice versa may not hold good. Think of dynamic medicine prices
in correlation with international crude prices.

Transportation

You are traveling by bus? You may pay more, while going back to your home in the
evening from your work place.

You are travelling by Airlines? You may pay more for your airline tickets in January-
March each year.

Business

People would face challenges in product and service pricing.

Do you have a Tours & Travels business? You may see a drop in business volumes in
winter season.

Have a retail business and does your target customer travel by his/her own car? If
yes, you may see a drop in customer volume and hence demand.

Car Port

So your car is in the Garage? And your mechanic is going to change

lubricants/motor oil/greaseHow much extra you are going to pay?

Agriculture

Now days, farmers are more inclined towards Modern Technologies used in
Agriculture. Equipment used in Agriculture run on Gasoline/Diesel. They may pay
extra few bucks for fuel as the crude price increases.

Unlike dynamic gasoline price, one can think of dynamic essential

commodity prices including food price in correlation with international
crude prices.