Why does the cost of oil vary in each country?

Question

I was watching news recently and i came to the point where the anchor started comparing fuel price of petrol in all countries. In mumbai, its 55 Rs/l , in US its 160 Rs/l, in Middle east its 5 Rs/l, in venezula its Rs 2/l. In the mid of high fuel prices, how can a country have oil prices as low as Indian rupees 2/l as compared to 160 Rs/l in USA? Please explain.

Answer 1

It depends on the demand for each country.  The US demands lots of oil so they end up paying more while in the Middle East their demand is lower since they produce it. This assuming that the supply remains the same.

PS. The Venezuela number is inaccurate because the price is artificially set by the state and not determined by supply and demand.

Answer 2

The main reason behind the price differentiation is the support each government provides to the cost of producing(or getting) Oil,besides the cost of transporting oil from source A to destination B,taxes for import/export.

http://en.wikipedia.org/wiki/Chart_of_ex...

http://en.wikipedia.org/wiki/Petroleum

The support of each country to the oil is

  .Decreses with increasing the consumption and consumers  (how many cars inside india???)

  .Decreases with the increasing the Average Salaries

first link,both india and usa got minus sign -1.7 for india and -12.2 for usa (are imports)

the second link will show you,tht india consumes abt  (energy consumption ,oil equialvalent)2.18 (barrel/person/year) and USA consumes abt 68.81(barrel/person/year).

       i wish if my explanation is enough to you.

        

                                                                            Yesso.

                                                                            Cairo,Egypt.

Answer 3

I think its because different countries have different economies, different value of their money...it probably also has to do with how much the government makes off of it with taxes, how much the companies what to profit off of the gas, how much oil is a barrel, how the country gets its oil, etc.