Petrol-Diesel Prices: Trade in crude oil has been significantly disrupted due to the escalating tensions in the Middle East, stemming from the conflict involving Israel, the US, and Iran. Consequently, the public has begun to experience difficulties. On the other hand, the Government of India has decided to reduce the excise duty on petrol.
The government has lowered the excise duty on petrol from ₹13 per litre to a total of ₹4 per litre. Furthermore, the excise duty on diesel has been reduced from ₹10 per litre to zero. The government has taken this step with the objective of shielding consumers from the impact of inflation. Amidst the conflict in West Asia, India has also successfully secured an adequate supply of crude oil from alternative sources to last for two months.
Will Petrol and Diesel Prices Decrease?
Amidst the global surge in petrol and diesel prices—driven by the conflict between the US, Israel, and Iran—the Central Government’s decision to cut excise duties is being viewed as a highly significant move for both the general public and the national economy. A reduction in excise duty directly benefits consumers, as it leads to a decrease in the retail prices of petrol and diesel.
According to information obtained from sources, although the Government of India has indeed lowered the excise duty, the likelihood of a corresponding reduction in the retail prices of petrol and diesel appears negligible. The excise duty reduction has been implemented primarily to help oil marketing companies recoup their financial losses.
How Many Days’ Worth of Crude Oil Reserves Does the Country Hold?
Amidst the tense situation in the Middle East, the Government of India has fully secured an adequate supply of crude oil from alternative sources to cover the next 60 days. This implies that India will not face any shortage of petrol or diesel for the next two months. According to the Union Ministry of Petroleum, adequate stocks are currently available at all petrol pumps across the country.
These pumps are operating normally, and there is no rationing of petrol or diesel taking place. However—particularly in smaller towns—some petrol pumps are facing difficulties in receiving fuel supplies after petroleum companies implemented a ‘Cash-and-Carry’ (cash-on-delivery) payment system. Meanwhile, a sudden surge in the demand for petrol and diesel has been observed across the country in recent days. Over the past two days, sales have witnessed an increase of more than 15% at the all-India level. Consequently, reports of panic buying have emerged.
