While normal diesel prices have been hiked by Rs. 5 across the country, little has been said about premium branded diesel which now sells at market prices. Branded diesel prices have gone up by Rs. 19 across the country.
Indian Oil ExtraMile, Bharat Petroleum Hi-Speed diesel, Hindustan Petroleum Turbo Jet will now be priced between Rs. 64 and Rs. 66 across the country. These branded fuels do not enjoy any sort of subsidy from the government now, and are being sold at market rates.
The real price of diesel
This is indicative of what the real price of diesel would be, if all subsidies were removed. Oil marketing companies were losing about Rs. 15 to Rs. 19 on every litre of diesel sold and even after the marginal price hike oil marketing companies will continue to lose about Rs. 9 per litre of diesel, which is then paid for by the government through a subsidy.
Branded diesel is normal diesel that is mixed with specific additives that help reduce soot buildup and carbon deposits in the engine and lubricate valves and fuel pumps, increasing the life of these components and making the engine sound quieter and smoother. They don’t give any specific power increase as such, but by keeping the engine clean, they allow the engine to achieve its maximum power more easily.
If you were used to using branded diesel, your running cost would have shot up, almost close to that of a petrol car. Also read: CNG vs. LPG vs. Petrol vs Diesel: A simple 4 step guide to deciding which fuel type works best for you
Is diesel still cheaper to run?
Let’s take an average price of branded diesel at Rs. 62, across brands and compare it with normal petrol that sells at an average of Rs. 71 across the country. It’s obvious that the price of petrol is still more expensive by only about Rs. 9 or so.
Diesel cars are inherently at least 25% more fuel efficient than petrol cars. So if a petrol car gives you an average of 10 km per litre, a diesel car of equivalent engine capacity would give you at least 12.5 kmpl if not more. To give you an example of this, take the Volkswagen Polo, whose petrol and diesel engines are of identical capacities – 1199 cc, three-cylinder engines. The petrol Polo gives a claimed mileage of 17 kmpl, while the diesel Polo has a claimed mileage of 22 kmpl. Also read: Diesel prices hiked by Rs.5; see how it will affect you!
Therefore under normal circumstances, a diesel car would still be more fuel efficient than a petrol and cheaper to run, even if fuel prices were equal.
Is there a cheaper alternative?
If you have been used to driving with branded diesel, with this increase in prices, it is just not worth your while filling premium diesel any more. Instead there are alternatives in the form of diesel additives that would do the same job, but at lower cost.
Diesel fuel additives such as System D, Bardahl fuel improver, STP Diesel fuel treatment, Wurth diesel additive, Valvoline diesel fuel treatment etc are available in the market and can be added to your vehicle to keep the engine in good health. One can add these once every four tankfuls if needed.
What these additives do is add lubricity to the diesel fuel. This is especially needed on vehicles that are BSIV compliant and run on low-sulphur diesel. Sulphur, though a harmful pollutant, is a useful lubricant in diesel fuel.
These additives cost from Rs. 200 to Rs. 800 per bottle depending on the brand and the dosage required. If you were to use one bottle to treat about 60 litres of diesel (at Rs. 200 per bottle), it works out to Rs. 3,017 per 60 litres on normal diesel (subsidized). But if you were to fill 60 litres of premium diesel, it would cost you Rs. 3,720 for a tankful. It’s obvious you save over Rs. 700, while still getting the same benefits.
If this is the kind of benefit you can get with additives, then it spells doom for premium diesel and makes no sense for oil marketing companies to sell it. Share your thoughts on this.