India cuts excise duties on petrol, diesel as Iran war drives oil shock
India, which imports about 88% of its crude oil and nearly half of its natural gas requirements, remains highly vulnerable to supply disruptions.
The government of India has sharply reduced excise duty on petrol to Rs3 per liter and eliminated it entirely on diesel, aiming to ease pressure on state-run fuel retailers grappling with a steep rise in global crude prices.
According to the finance ministry, the excise duty on petrol has been cut from Rs13 per litre to Rs3, while the levy on diesel has been reduced from Rs10 per litre to nil from yesterday (26 March).
The move comes as domestic fuel retailers face mounting financial strain after holding retail prices steady despite a nearly 50% surge in international oil prices since late February.
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The spike followed military strikes by the US and Israel on Iran and subsequent retaliation.
Retail fuel prices in the capital remain unchanged, with petrol priced at Rs94.77 and diesel at Rs87.67 per liter.
India, which imports about 88% of its crude oil and nearly half of its natural gas requirements, remains highly vulnerable to supply disruptions.
A significant portion of these imports passes through the Strait of Hormuz, where shipping movement has been affected amid the conflict.
State-owned oil marketing companies, which account for roughly 90% of the domestic fuel retail market, have so far absorbed the higher input costs by keeping pump prices unchanged.
However, private player Nayara Energy has begun passing on part of the cost increase to consumers.
Petrol prices at its outlets have risen to Rs100.71 per litre, while diesel is being sold at Rs91.31 per litre.
Meanwhile, Jio-bp—a joint venture between Reliance Industries and BP Plc—has not yet revised retail prices, despite incurring losses on fuel sales.
