The government of India on Friday reduced excise duties on petrol and diesel by about Tk 13 per litre each (Rs 10), bringing the levy on petrol down to around Tk 4 per litre and eliminating it on diesel.
The move comes amid a sharp rise in global crude oil prices driven by the ongoing US-Israel war on Iran and supply disruptions in the Strait of Hormuz, a key channel for global energy trade.
Despite the reduction, industry sources said consumers may not see an immediate drop in retail fuel prices, as oil marketing companies (OMCs) are likely to absorb the benefit to offset losses resulting from elevated crude prices.
Petroleum Minister Hardeep Singh Puri said global crude prices have surged from around $70 per barrel to over $120 in recent weeks, leading to fuel price increases worldwide.
He said the government opted to absorb part of the financial impact to shield consumers from international volatility, rather than passing on the full burden.
The duty cut follows recent price hikes by private fuel retailer Nayara Energy, which increased petrol and diesel prices by about Tk 7 and Tk 4 per litre respectively.
Following the revision, total central excise duty now stands at around Tk 16 per litre for petrol and about Tk 10 per litre for diesel, continuing a downward trend in fuel taxation since 2020.
Officials said India has sufficient fuel reserves and is taking steps to diversify its import sources, as a significant portion of its oil supply depends on the Strait of Hormuz amid ongoing geopolitical tensions.
Source: NDTV