Government Hikes Excise Duty on Petrol and Diesel by ₹2 per Litre, Retail Prices Unlikely to Change
Mumbai: On Monday, April 7, the Indian government raised the excise duty on both petrol and diesel by ₹2 per litre, effective from Tuesday. Despite the increase, Union Minister for Petroleum and Natural Gas, Hardeep Singh Puri, assured the public that the hike would not result in higher retail prices for consumers.
According to the government’s notification, the excise duty on petrol has been increased to ₹13 per litre, while diesel will now incur an excise duty of ₹10 per litre. Although the order did not specify its impact on retail prices, industry sources indicated that there would likely be no change at the consumer level. This is expected to be due to adjustments made to offset the reduction in petrol and diesel prices, which had been warranted by the recent drop in global oil prices.
The Ministry of Petroleum and Natural Gas confirmed via a post on X (formerly Twitter) that Public Sector Undertaking (PSU) Oil Marketing Companies had stated there would be no increase in retail prices following the excise duty hike.
Central Government raises excise duty by Rs 2 each on petrol and diesel: Department of Revenue notification pic.twitter.com/WjOiv1E9ch
— ANI (@ANI) April 7, 2025
The government’s decision to raise excise duties comes under the provisions of section 5A of the Central Excise Act, 1944, and section 147 of the Finance Act, 2002, and is aimed at addressing public interest concerns.
In December 2024, the government had previously removed the windfall profit tax on locally produced crude oil and fuel exports, following a fall in global oil prices. Puri explained that while international crude oil prices had dropped to around $60 per barrel, Indian oil marketing companies still held inventories priced at $75 per barrel on average, reflecting the market conditions from January when prices were higher.
He assured that in line with global trends, consumers could expect petrol and diesel prices to be adjusted accordingly by oil marketing companies in the deregulated sector, ensuring retail prices are moderated.
Puri emphasized that despite the excise duty increase, it would not be passed on to the consumer, as the government continues to monitor market conditions closely.
Follow us on Twitter, Google News, and Instagram and like us on Facebook for the latest updates and exciting stories.
