Aashish

I felt like a weight was just lifted off me so Lord knows how Bruno Fernandes must feel. He has now officially and undeniably entered the pantheon of Premier League greats. We all knew it, now they can’t deny it. 👑

People compare petrol prices between 2014 and today without comparing the underlying economics behind those prices. As an economics student, that comparison is incomplete unless you account for inflation, rupee depreciation, crude oil prices, and subsidies. In 2014, the dollar was around ₹60–63. Today, retail forex rates are hovering near ₹96 in many markets. That is a depreciation of roughly 50%. India imports more than 85% of its crude oil, and oil is traded globally in dollars. So even if international crude prices stay similar, India still pays far more in rupee terms because the rupee itself has weakened sharply. Now look at global crude prices. Between 2011–2014, Brent crude was often above $100/barrel. Yet petrol in Delhi was around ₹72/litre in 2014. But that price did not fully reflect market reality because India was running massive fuel subsidies and under-recoveries. Oil companies were compensated through: • direct subsidies • oil bonds • deferred liabilities • government burden sharing Petroleum under-recoveries at one stage crossed ₹1.3 lakh crore annually. So a part of the real fuel cost was hidden from consumers and shifted to future taxpayers through fiscal burden and borrowing. Today that structure is mostly gone: • petrol subsidies are effectively zero • diesel subsidies are largely removed • LPG subsidies are highly targeted • old oil bond liabilities are still being serviced That means today’s fuel prices are much closer to actual market-linked pricing. Now add inflation. India’s cumulative CPI inflation since 2014 is closer to ~55–65%, not 80%. So ₹72 in 2014 would roughly translate to around ₹112–118 today in inflation-adjusted terms. 72\times1.6\approx115 Then add: • rupee depreciation • removal of subsidies • logistics and refining costs • taxes From a pure economics perspective, petrol prices today being around ₹95–110 are not as irrational as political debates make them sound. That said, one criticism IS economically valid: After 2014, especially during the global crude crash of 2015–2020, the government significantly increased excise duties. Consumers did not fully benefit from low crude prices because the state captured much of the margin for: • infrastructure spending • welfare expenditure • fiscal deficit control • capital expenditure So comparing only nominal petrol prices between 2014 and today, without adjusting for: • inflation • exchange rate • subsidy burden • crude oil prices • taxation structure is academically weak analysis. The better comparison is real economic cost and purchasing power, not just the number displayed outside a petrol pump.