This situation arises after a period of stability for petrol and diesel prices in India since April 2022. Despite rising global crude oil costs, the government had previously reduced excise duty by ₹10 per litre, resulting in a revenue loss of ₹1.7 lakh crore annually for the state.

Expected price adjustments:

• Petrol and diesel prices are likely to increase by ₹2 to ₹4 per litre soon.
• OMCs are currently losing ₹24 per litre on petrol and ₹30 per litre on diesel.
• The average price of a 19-kg LPG cylinder in Delhi has reached ₹3,071.50.

Meanwhile, LPG demand has also taken a hit; consumption fell by 16.16% in April 2026, dropping to 2.2 million tonnes. This decline in LPG usage reflects broader economic challenges as inflation continues to affect consumer behavior.

A senior official noted, “We cannot keep prices unchanged when there are supply issues. At some point, we have to make adjustments according to market conditions.” The government acknowledges that a price adjustment is unavoidable given the financial strain on OMCs.

Looking ahead, the government is expected to announce a price increase for petrol and diesel soon after the election results. This decision will likely impact consumers across India as they grapple with rising costs amidst ongoing inflationary pressures.

The post Petroleum Prices Surge Amid Financial Losses for OMCs appeared first on newsrush.

In recent months, the landscape of petrol and diesel pricing in India has undergone a significant transformation. Prior to the latest developments, the excise duty on petrol stood at Rs 13 per litre, while diesel was taxed at Rs 10 per litre. This structure was a response to rising global crude oil prices, which had surged from approximately $70 per barrel to nearly $122 per barrel. As a result, oil marketing companies faced substantial losses, estimated at around Rs 24 per litre on petrol and Rs 30 per litre on diesel. The government’s approach to fuel pricing had been a balancing act, attempting to manage revenue while also considering consumer sentiment.

On March 27, 2026, a decisive moment arrived when the government announced a cut in excise duty on petrol by Rs 10 per litre, reducing it to Rs 3 per litre. Furthermore, the excise duty on diesel was eliminated entirely, dropping to zero. This move was largely seen as a response to public concern over rising fuel costs, especially with state elections on the horizon. The Finance Minister, Nirmala Sitharaman, emphasized that the reduction in excise duty would provide protection to consumers from the rising prices, highlighting the government’s intent to shield the public from the full impact of escalating global oil prices.

However, the immediate effects of this excise duty cut have raised questions. Despite the reduction in excise duty, retail pump prices remained unchanged. Oil companies, which determine retail fuel prices based on global crude prices, exchange rates, and their margins, have been grappling with the implications of these changes. The government’s decision is expected to lead to a revenue loss of INR 1.75 lakh crore annually, which poses a challenge for fiscal management. The oil minister, Hardeep Singh Puri, noted that the government faced a choice between passing on the full impact to consumers or absorbing part of the shock, indicating the delicate balance the government is trying to maintain.

Experts suggest that while the excise duty cut may not lead to immediate reductions in fuel prices, it could prevent further price hikes amid global uncertainty. The cut is being utilized to stabilize prices rather than to reduce them, which reflects a pragmatic approach in a volatile market. The long-term impact of this excise duty cut on retail fuel prices remains uncertain, and it is unclear how quickly oil marketing companies will pass on the benefit of the duty cut to consumers. Details remain unconfirmed.

The backdrop to these changes is a complex interplay of international market dynamics and domestic policy considerations. The government has also imposed export duties of INR 21.5 per litre on diesel and INR 29.5 per litre on aviation turbine fuel (ATF) to manage the domestic supply and ensure that local consumers are prioritized. This regulatory environment underscores the challenges faced by the government in balancing the needs of the economy with consumer protection.

As the situation evolves, the implications of the excise duty cuts will be closely monitored by both consumers and industry stakeholders. The government’s ability to navigate these changes will be crucial in maintaining public confidence and ensuring economic stability. The fuel pricing policy will continue to be a focal point of discussion, particularly as global crude prices remain unpredictable and the economic landscape shifts.

In summary, the recent excise duty cuts on petrol and diesel signify a pivotal moment in India’s fuel pricing strategy. While aimed at alleviating consumer burden, the broader economic implications and the response from oil marketing companies will be critical in shaping the future of fuel prices in the country.

The post Petrol Diesel Price Excise Duty Changes: An Overview appeared first on newsrush.