- The short — five-line brief
- Formula: from Brent & USD/INR to pump price
- OMC margin ladder (illustrative)
- City bands & household math
- What can break the math (policy, inventories, cracks)
The short
- Direction: Lower Brent and a stable INR usually widen OMC GMM and keep retail bands steady.
- Sensitivity: ~₹0.40–₹0.60/L per US$1/bbl move (diesel closer to the high end); ~₹0.50–₹0.70/L per ₹1 on USD/INR.
- Inventory lag: Spot changes drip into pumps with a lag; clean trends matter more than one-day moves.
- Policy: Excise/VAT tweaks or ad-hoc retail band management can override pure-cost signals.
- Households: City bands allow budgeting; EV math still wins on per-km energy cost, finance costs aside.
Formula — from Brent + USD/INR to pump price (simplified)
Pump price (₹/L) ≈ landed product cost (Brent × crack × FX) + freight + OMC opex + dealer margin + central excise + state VAT.
- Brent: Base crude marker.
- Cracks: Product spreads (gasoline/diesel) vs crude; move independently and shift margins.
- FX: Most inputs priced in USD; INR depreciation lifts landed cost.
- GMM (₹/L): Pump price net of taxes − landed cost − logistics/opex.
Tip Use trends, not ticks. A 2–3 week drift in Brent/INR is more predictive of retail adjustments than a 24-hr spike.
OMC margin ladder (illustrative)
| Scenario | Brent (US$/bbl) | USD/INR | Indicative petrol GMM (₹/L) | Indicative diesel GMM (₹/L) | Comment |
|---|---|---|---|---|---|
| A | 60 | 83 | ₹4.5–6.0 | ₹5.0–6.5 | Benign; room for promo/retail band stability |
| B | 70 | 84 | ₹3.0–4.5 | ₹3.5–5.0 | Comfortable if cracks don’t spike |
| C | 80 | 86 | ₹1.0–2.5 | ₹1.5–3.0 | Tight; selective under-recovery risks appear |
| D | 75 | 88 | ₹0.5–2.0 | ₹1.0–2.5 | FX hurts more than Brent in short bursts |
Rule of thumb: Watch crack spreads; a diesel crack spike can compress GMM even if Brent is stable.
City bands & household math (illustrative)
| City | Petrol (₹/L) | Diesel (₹/L) | Note |
|---|---|---|---|
| Delhi | 102–105 | 90–93 | Baseline bands |
| Mumbai | 106–110 | 93–97 | Higher VAT/cess |
| Bengaluru | 102–106 | 88–92 | Recent tax resets reflected |
| Chennai | 101–104 | 92–95 | Levy mix different |
Monthly car fuel bill (Delhi band)
- 1,000 km @ 14 km/L (petrol): ₹7,250–₹7,500
- 1,000 km @ 18 km/L (diesel): ₹5,000–₹5,200
- EV @ 7 km/kWh, ₹9/kWh: ~₹1,285 (ex-parking/finance)
What can break the math
- Tax changes (excise/VAT) or temporary retail band management.
- Inventory timing (older, costlier cargoes vs new spot purchases).
- Crack spread spikes (especially diesel) independent of Brent.