India Cuts Petrol, Diesel Excise Amid Crude Surge

The Finance Ministry has reduced central excise duty on petrol from ₹13 to ₹3 per litre and eliminated it entirely on diesel, effective immediately. The move aims to cushion state-run oil marketing companies from mounting losses caused by rising global crude prices.

Retail Prices Remain Unchanged

Despite the excise cuts, fuel prices at the pump will not fall. Petrol in Delhi continues at ₹94.77 per litre and diesel at ₹87.67 per litre. The rates are maintained by Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation, which together control about 90 percent of India’s fuel market.

Financial Strain On State-run Retailers

State-owned fuel retailers have been under significant pressure due to soaring crude prices. Rating agency ICRA noted that if crude hits $100–105 per barrel, companies would face losses of ₹11 per litre on petrol and ₹14 per litre on diesel. Brent crude surged roughly 74 percent from late February, peaking around $119–122 per barrel.

Government Measures To Offset Losses

Petroleum Minister Hardeep Singh Puri highlighted that the government has absorbed revenue losses to support OMCs, covering company-level losses of approximately ₹24 per litre on petrol and ₹30 per litre on diesel. The decision follows Nayara Energy’s recent price hike, the first major adjustment by a private retailer since fuel rates were frozen in April 2022.