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  • Overall cost of producing 1 liter of petrol

    Kaustubh Katdare

    Kaustubh Katdare

    @thebigk
    Updated: Oct 27, 2024
    Views: 1.1K
    I've been wondering how much would be the overall cost of producing 1 liter of petrol. I've no clue what kind of processing is done on raw oil extracted from Earth's core and what are the costs involved. If anyone's got some knowledge of this topic, please post it here. It'd help if you could post a break-up of the processes and costs involved.
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  • Ramani Aswath

    Member • Jul 11, 2012

    Refinery costs may be about 10 - 15% of the cost of crude oil. All the other costs are add on.
    In US this will be about 10 cents/litre
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  • Kaustubh Katdare

    Administrator • Jul 11, 2012

    What would be the break-up of the overall extraction process?
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  • Ramani Aswath

    Member • Jul 11, 2012

    Most of the refineries here are from the US. I had spent some time (very long back) at the Caltex refinery at Vizag. Most of the senior technical people were from the US. We can take the processes to be the same. Labour may be slightly cheaper. However, this is not a major component in petroleum refining.
    This report of US refining may throw some light:
    #-Link-Snipped-#
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  • Kaustubh Katdare

    Administrator • Jul 11, 2012

    Thanks. I think I'll explore it further. I was more interested in looking at the costs associated at each step.
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  • prashpan

    Member • Jul 11, 2012

    Crude Oil is at about USD 100 today . At today’s exchange of Rs. 56 per USD
    this works out to Rs. 5600 per barrel.
    A barrel of Crude produces approx. 150 liters of Petrol or its equivalent.
    The total of all other costs involved in converting crude to Petrol – which includes transport of crude and refined products, cost of refining, reasonable refining margin for the refinery, fuel used by the refinery, dealer commission, etc. – is approx. USD 12, which works out to Rs. 672 per barrel.
    (5600+672)/150 = 41.8133 Rs / Liters
    Sources : #-Link-Snipped-#
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  • Kaustubh Katdare

    Administrator • Jul 11, 2012

    Nope, you are 'reverse' calculating the costs. I'm purely interested in knowing the price it requires to get 1 liter of petrol from crude oil without any taxes added.
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  • Ramani Aswath

    Member • Jul 11, 2012

    Crude oil is a mixture of hydro carbons from virtually gas to thick tar. Itis separated by fractional distillation. There is no chemical processing. Depending on demand a process called catalytic cracking can be used to produce more petrol at the cost of other heavier fuels.
    About 45 to 50% comes out as petrol about 40% as diesel, aviation fuel and others. The rest is heavy fuel oil and tarry matter. Actual percentages vary from source to source.
    The major step is the distillation. Sulphur compounds called mercaptans give a foul smell. These are removed by a process called 'sweetening'. There are small additional costs for such cat cracking and sweetening.
    Unlike in the case of other chemicals, there is not much processing involved in petroleum refining.
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