New Delhi

The Centre has reduced excise duty on petrol and diesel by ₹10 per litre each to cushion consumers from rising global crude oil prices amid ongoing tensions in West Asia. The move is expected to cost the government around ₹1.75 lakh crore in revenue annually.

At the same time, the government has reintroduced export duties on diesel and aviation turbine fuel (ATF) to ensure adequate domestic availability. The new levies include ₹21.5 per litre on diesel exports and ₹29.5 per litre on ATF.

According to the revised structure, the special additional excise duty on petrol has been lowered from ₹13 per litre to ₹3, while on diesel it has been reduced from ₹10 per litre to zero. However, no windfall tax has been imposed on domestic crude producers such as Oil and Natural Gas Corporation.

Following the changes, total excise duty on petrol now stands at ₹11.9 per litre, while diesel carries a duty of ₹7.8 per litre, including various cesses.

The decision comes against the backdrop of a sharp rise in international crude oil prices, which surged significantly due to disruptions in global supply chains linked to the ongoing geopolitical conflict. Despite crude crossing $100 per barrel, retail fuel prices in India have largely remained unchanged, leading to mounting losses for oil marketing companies.

To ease the financial burden on these companies, the government opted to cut excise duties instead of passing on the full price increase to consumers. Estimates suggest that without intervention, petrol prices would have required a hike of around ₹24 per litre and diesel by ₹30 per litre.

Finance Minister Nirmala Sitharaman said the move is aimed at protecting consumers from global price volatility. She added that the export duties will help maintain sufficient fuel supplies within the country.

Petroleum Minister Hardeep Singh Puri highlighted that global fuel prices have surged sharply across regions, forcing governments worldwide to either raise retail prices or absorb the impact.

He said India has chosen to shield citizens by taking a hit on government revenues while also supporting oil companies facing significant losses.

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The minister also dismissed rumours about any possible lockdown, urging people not to panic and to rely only on official information. He assured that the government is closely monitoring the situation and taking steps to ensure uninterrupted supply of fuel and other essential commodities.