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roleum prices were deregulated in June 2010, they were made market determined. The international crude prices have risen roughly $75 a barrel to nearly $100 a barrel, since June, resulting in increasing retail petrol prices.

The firming up of crude oil prices internationally, a product of global recovery was indicated by the last two price increases. Crude oil prices had touched $147 a barrel before international prices collapsed with the financial system in the second half of 2008. Worldwide demand for oil is again rising, raising international prices with the renewed global recovery in economic growth now.

Respite can come from three quarters, which are:

A fall in demand

Increased supplies

The Various Categories Of Fuel

Changes in the way oil is priced domestically

55% of oil used worldwide which shows that demand for energy from oil is maximum from the transportation sector. Commercial vehicle sales raise by 34% over 2009 while passenger car sales raised by 32% in 2010. In 2010, over 2009, car sales raise by 13%in the US. Demand for oil increases as more cars hit the roads.

People tend to cut back on the consumption level for e.g. driving less, as oil prices rise. The greater is the price, the higher is the tendency to cut back consumption. Nevertheless, aggregate demand is likely to scale newer peaks in 2011 due to rising prices even if demand moderates. Oil producing countries were quick to reduce extraction and supply after demand crashed in 2008 and 2009. Production is yet to be ramped up. Simply adjustments to demand become difficult, although they promised to do so on January 24, which should moderate inter-national crude prices beyond certain level. There is a peak level of production possible on th back of sustained demand, which is called the “peak oil” theory.

Taxes and levies imposed by the government also affect the retail price of petrol. The price what oil (OMCs) pay to buy, refine, transport and sell oil is actually greater than the retail price minus all taxes.

The central government levied customs duty on crude oil by 5% and 7.5 % on petrol and Diesel. 25% of what we pay form part of the Rs14.35 excise duty levied on 1 litre of petrol. Moreover, Rs4.60 is the excise duty on diesel per litre.

The centre’s indirect tax revenue which comes from the petroleum sector is almost 40%. In three of the last four years, tax revenue from fuels has been three to four times the subsidy which the government had paid on them. Sales and value added taxes have also been imposed by the state governments.

The domestic distribution of oil is the responsibility of the companies owned by the government, and all private oil sectors are export-oriented. However, a program to strengthen exports has been laid by the Indian government.

(President of Assocham, 2010; Maekawa, 2010; Kawamura, 2010)

Mauritius

All the importation of petroleum products in Mauritius is done by State Trading Corporation (STC).

The local oil companies are as follows:

Shell (Mauritius) Limited

Total Mauritius Limited

Caltex Oil ( Mauritius) Limited

Indian Oil (Mauritius) Limited

Petroleum products are procured through open international tenders by the STC. However,