Excise duty on petrol, diesel slashed amid rising crude prices due to West Asia crisis

Mangalore Today News Network

New Delhi, Mar 27, 2026: The government has reduced excise duty on petrol to ₹3 per litre and completely exempted diesel from excise duty to support oil marketing companies such as HPCL, BPCL, and IOC amid rising global crude oil prices triggered by the ongoing conflict in West Asia.

According to a Finance Ministry notification dated March 26, excise duty on petrol has been cut from ₹13 to ₹3 per litre, while the duty on diesel has been reduced from ₹10 to zero. The revised rates have come into effect immediately.

Indian fuel retailers have been under pressure as petrol and diesel prices at the pump have remained unchanged, despite nearly a 50% increase in international oil prices since February 28, following military strikes by the United States and Israel on Iran, which led to retaliatory actions from Tehran.

Rating agency ICRA stated that if crude oil prices rise to $100–$105 per barrel, fuel retailers could incur losses of ₹11 per litre on petrol and ₹14 per litre on diesel, according to a PTI report.

Global oil prices had surged to $119 per barrel earlier this month before easing to around $100 per barrel.

In Delhi, petrol continues to retail at ₹94.77 per litre, while diesel is priced at ₹87.67 per litre.

India imports about 88% of its crude oil requirements and nearly half of its natural gas, much of which passes through the Strait of Hormuz. As the conflict escalated, Iran blocked the strategic route, and insurance coverage for tankers was withdrawn, disrupting shipments.

Nayara Energy, which operates 6,967 fuel stations across India, has increased retail prices, with petrol now at ₹100.71 per litre and diesel at ₹91.31 per litre.

Meanwhile, Jio-bp, a joint venture between Reliance Industries and BP Plc, which runs 2,185 outlets, has so far not raised prices despite facing significant losses.

State-owned fuel retailers, which account for nearly 90% of the market, have continued to keep fuel prices unchanged.