The Indian government has reduced excise duty on petrol and diesel by ₹10 per litre in an effort to manage the impact of rising global crude oil prices. This decision comes at a time when international oil markets are under pressure due to ongoing tensions in the Middle East.
The Finance Ministry announced that the excise duty on petrol has been reduced from ₹13 per litre to ₹3 per litre. For diesel, the duty has been completely removed, bringing it down from ₹10 per litre to zero. The move is expected to support both consumers and fuel companies during a period of high global prices.
Major state-run oil companies such as Indian Oil Corporation, Bharat Petroleum Corporation Ltd, and Hindustan Petroleum Corporation Ltd are likely to benefit from this decision. These companies have been facing financial pressure due to the gap between global crude prices and domestic fuel rates.
Despite the reduction in excise duty, petrol and diesel prices at retail pumps have largely remained unchanged across major cities. This has surprised many consumers who expected an immediate drop in prices.
In New Delhi, petrol is priced at ₹94.77 per litre, while diesel costs ₹87.67 per litre. In Mumbai, petrol is being sold at ₹103.54 per litre and diesel at ₹90.03 per litre.
Similarly, in Kolkata, petrol costs ₹105.45 per litre and diesel ₹92.02 per litre. In Chennai, petrol is priced at ₹100.84 per litre and diesel at ₹92.39 per litre.
Other major cities like Bengaluru and Hyderabad also continue to see high fuel prices, with petrol crossing ₹100 per litre in many places.
Experts say that even after the tax cut, oil companies are not reducing retail prices because they are already facing losses. According to reports, if crude oil prices rise to around $100–105 per barrel, companies could lose ₹11 per litre on petrol and ₹14 per litre on diesel.
International oil prices recently touched as high as $119 per barrel before falling slightly to around $100. This volatility has made it difficult for companies to adjust prices quickly.
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While state-run companies have kept prices unchanged, some private players have taken a different approach. Nayara Energy has increased petrol prices by ₹5 per litre and diesel by ₹3 per litre at its outlets.
At Nayara pumps, petrol now costs around ₹100.71 per litre, while diesel is priced at ₹91.31 per litre. The company operates thousands of fuel stations across the country and has decided to pass on part of the rising cost to consumers.
On the other hand, Jio-bp has not increased its prices yet, even though it is also facing financial pressure. This shows that different companies are adopting different strategies based on their business models and financial situations.
The government’s decision to cut excise duty is seen as a balancing step. On one hand, it reduces the burden on oil companies, and on the other, it tries to control inflation and protect consumers from sudden price hikes.
However, the benefits of the duty cut may not be fully visible to consumers immediately. Instead, it is helping oil companies recover some of their losses and maintain stable prices in a volatile market.
The situation is closely linked to global events. The ongoing conflict in the Middle East has disrupted oil supply chains and increased uncertainty in the market. Since India imports a large portion of its crude oil, it is directly affected by such changes.
In conclusion, the ₹10 per litre excise duty cut on petrol and diesel is a significant step by the government to manage rising fuel costs. While retail prices have not decreased yet, the move is helping oil companies cope with global price pressures.
Consumers may not see immediate relief at the pump, but the decision aims to prevent further price increases. As global oil prices continue to fluctuate, future fuel rates will depend on both international trends and government policies.
For now, the focus remains on maintaining stability in fuel prices while managing the economic impact of rising crude oil costs.
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