Govt Cuts Petrol Excise Duty to Rs 3, Diesel to Zero Amid US-Israel-Iran War

FM: Protecting from Global Price Surge

Finance Minister Nirmala Sitharaman on social media declared the government's move of duty reduction as that which is intended to protect consumers from the consequences of rising fuel costs.
She further stated that the Modi government has been continuously trying to shield the citizens from the stuffing of global supply chains and essential commodity prices.

In addition to the excise duty cut, the government has also introduced an export duty of Rs 21.5 per litre on diesel and Rs 29.5 per litre on aviation turbine fuel (ATF). This decision is a way to keep sufficient domestic stocks as international prices continue to rise.

Puri: Big Revenue Hit for Consumer Relief

Petroleum Minister Hardeep Singh Puri stated that the government had compromised a major part of tax revenue in order to support the losses by oil companies, which have been estimated as is the case of petrol around Rs 24 per litre and Rs 30 per litre for diesel.
“The Government has taken a huge hit on its taxation revenues to ensure very high losses of oil companies at this time of sky high international prices are reduced. At the same time, export tax has been levied as international prices of petrol and diesel have skyrocketed and any refinery exporting to foreign nations will have to pay export tax. My gratitude to PM Narendra Modi and Union Minister Nirmala Sitharaman for this very timely, bold and visionary decision," he said.

Oil Firms to Hold Prices Steady

Indian fuel marketing firms have been suffering since the retail prices of petrol and diesel still do not reflect the almost 50 per cent rise in the price of internationally traded oil that has occurred since February 28, the day the United States and Israel launched military strikes on Iran which in turn led to massive retaliation from that country.
In fact, in such a case, oil marketing companies normally share some of the hike in input cost with the consumers. Nonetheless, with this reduction in excise tax, oil marketing companies such as Hindustan Petroleum Corporation Ltd. (HPCL), Bharat Petroleum Corporation Ltd. (BPCL) and Indian Oil Corporation Ltd. (IOC) will stand a good chance of holding the petrol and diesel prices unchanged for the consumers.