Its benefits for consumers

♤ The move will take the economy towards greater transparency in fuel pricing and free pricing of petrol and diesel.

♤ It will ensure that the benefit of even the smallest change in international oil prices can be passed down the line to the dealers and the consumers.

♤ Besides the move will remove big leaps in rates that need to be effected at the end of the fortnight.

♤ Consumers will be more aligned to market dynamics as India will be following the practice of the most advanced markets.

♤ This will also lead to public sector OMCs offering competitive prices. Not only, it will improve the competitiveness of the economy overall, but also it would incentivise investments in the oil sector.

The introduction of dynamic pricing will definitely bring consumers on a better footing as it will make the demand elasticity of the consumers reflected well in the markets. This will be possible as the price and sales data will be available in public for the market participants to reflect the same. However, there are certain obstacles to be overcome like updating of prices in unautomated petrol pumps and staying the course on hardening of oil prices.