India Business Journal - Special Additional Excise Duty on petrol, diesel cut, prices unlikely to soften

ECONOMY

Special Additional Excise Duty on petrol, diesel cut, prices unlikely to soften

IBJ Bureau
Mar 28, 2026

The government has slashed Special Additional Excise Duty on petrol and diesel by Rs 10 per litre each. This brings the Centre-imposed taxes down to Rs 3 per litre of petrol and zero for diesel.

However, industry sources note that the reduction is unlikely to translate into lower prices at fuel stations for most consumers, as the cut will largely be absorbed by oil marketing companies (OMCs) to offset heavy losses on sales of the fuels.

OMCs are currently losing Rs 48.80 per litre of petrol or diesel sold, in large part due to the surge in Brent crude oil prices. The global benchmark has crossed the $100-per-barrel red line after the US-Israel war on Iran broke out and led to the blockade of Strait of Hormuz.

In a long post on the X, Petroleum Minister Hardeep Singh Puri has said: “International crude oil prices have gone through the roof in the last month from around $70 per barrel to around $122 per barrel. Consequently, petrol and diesel prices for consumers have gone up all over the world. Prices have increased by around 30 to 50 per cent in South-East Asian countries, 30 per cent in North American countries, 20 per cent in Europe and 50 per cent in African countries.”