Govt Slashes Excise Duty By Rs 10/Litre On Petrol And Diesel

The Indian government has announced a significant reduction in excise duty on petrol and diesel — cutting it by Rs 10 per litre — in a major relief measure for consumers reeling under the inflationary pressure of surging global crude oil prices driven by the ongoing Middle East conflict.

Excise duty on petrol has been slashed from Rs 13 to Rs 3 per litre, while duty on diesel has been reduced from Rs 10 to zero — effectively eliminating the central excise component on diesel entirely. The move is designed to give state-owned oil marketing companies — Indian Oil Corporation, BPCL, and HPCL — the fiscal headroom to absorb rising international crude costs without passing the burden on to consumers through retail price hikes.

The decision comes amid the escalating military conflict between the US, Israel, and Iran, which has triggered panic buying in international crude markets and pushed Brent prices to historic highs. The urgency was further underscored by private fuel retailers entering the fray — Nayara Energy, India's largest private fuel company, had already raised petrol prices by Rs 5 and diesel by Rs 3 per litre. Jio-BP, the Reliance-BP joint venture, has held prices despite mounting losses.

Even as the excise cut brings relief to ordinary vehicle users, state-owned companies had last week raised premium or high-grade petrol prices by Rs 2 per litre, while wholesale diesel prices for industrial consumers were hiked by Rs 22 per litre. The latest duty reduction, however, is expected to stabilise prices for the vast majority of consumers who use standard petrol and diesel.