India's Fuel Price Strategy: Navigating Global Oil Turbulence

The Indian government has announced a significant reduction in excise duties on petrol and diesel by Rs 10 per litre, avoiding anticipated retail price hikes due to rising global oil prices. The excise duty reduction from Rs 13 to Rs 3 per litre for petrol and from Rs 10 to zero for diesel aims to balance fuel losses, currently estimated at Rs 24 per litre for petrol and Rs 30 for diesel, according to Oil Minister Hardeep Singh Puri.

In a move to curb refinery windfall gains, the government also reinstated export duties on diesel and aviation turbine fuel, first introduced in 2022 and later withdrawn. This decision is part of a broader strategy to maintain domestic fuel availability as geopolitical tensions escalate oil prices globally. Joint Secretary Sujata Sharma reported that crude oil prices jumped from USD 70 to over USD 100 due to Middle Eastern conflicts.

Finance Minister Nirmala Sitharaman reassured the public, highlighting efforts to shield consumers from price surges. Despite high international crude costs, India remains committed to ensuring uninterrupted fuel and energy supplies, absorbing financial hits to protect its citizens. The export tax will be reviewed fortnightly to maintain alignment with existing rates, reinforcing domestic energy stability.

(With inputs from agencies.)