The government on Monday raised excise duty on petrol and diesel by ₹2 per litre. The move comes in response to ongoing global oil price changes and tariff tensions triggered by former US President Donald Trump. While the order didn’t clarify its impact on retail fuel prices, it’s unlikely to directly affect Indian consumers for now. The hike is expected to support the Union government’s revenue collection.
The government’s decision to raise excise duty on petrol and diesel by ₹2 per litre is likely to be offset by the recent drop in international oil prices, which had already led to cuts in fuel rates. Despite this, the stock market saw a negative impact, with shares of major oil marketing companies declining. On the Bombay Stock Exchange, Reliance Industries closed at ₹1170.95, down 2.80%, Indian Oil fell by 1.65% to ₹128, Hindustan Petroleum dropped 2.75% to ₹348.20, and Bharat Petroleum slipped 1.34% to ₹275.65.
Both Brent and WTI crude prices dropped to their lowest levels since April 2021. Brent futures declined by $2.23, or 3.4%, to $63.35 a barrel, while U.S. West Texas Intermediate (WTI) crude fell by $2.22, or 3.58%, to $59.77. Over the past week, Brent slipped by 10.9% and WTI by 10.6%. In India, the last fuel price cut was on March 14, ahead of the Lok Sabha elections, after prices had remained unchanged since May 22, 2022.
The freeze came after two excise duty cuts that brought down petrol prices by Rs 13 and diesel by Rs 16 per litre. Recently, Oil Minister Hardeep Singh Puri said there could be more cuts in fuel prices if global crude oil rates stay low.
