Published Mar 27, 2026 | 10:27 AM ⚊ Updated Mar 27, 2026 | 10:27 AM
A fuel station in India. (iStock)
Synopsis: In view of the escalating crude oil prices, the Union government reduced the excise duty for petrol and diesel. Union Finance Minister Nirmala Sitharaman said the excise duty has been reduced by ₹10 per litre for both petrol and diesel.
In view of the escalating crude oil prices due to the ongoing US-Israel and Iran war and the disruption of transportation via the Strait of Hormuz, the Union government on Friday, 27 March, reduced the excise duty for petrol and diesel.
Union Finance Minister Nirmala Sitharaman said the excise duty has been reduced by ₹10 per litre for both petrol and diesel. With this, the effective excise duty for petrol is now ₹3 per litre and zero for diesel.
However, the reduction of excise duty is unlikely to benefit retail customers.
“In view of the West Asia crisis, the central excise duty on petrol and diesel for domestic consumption has been reduced by ₹10 per litre each. This will provide protection to consumers from rise in prices. Hon. PM @narendramodi has always ensured that citizens are protected from vagaries of supply and costs of essential goods,” Sitharaman said.
“Further, duties have been imposed on exports of Diesel at ₹21.5 per litre and on ATF at ₹29.5 per litre. This will ensure adequate availability of these products for domestic consumption. The Parliament has been notified about the same,” she added.
The crude oil price currently hovers around the range of $93–98 per barrel. However, it is to be noted that the excise duty remained the same even when crude oil prices were in the range of $55–70 per barrel between July 2025 and January 2026, with the price going as low as $54.6 in December 2025, earning the Union government a massive revenue.
The current reduction comes on the heels of a sharp hike in fuel prices by Nayara Energy, the country’s largest private fuel retailer, which raised petrol prices by ₹5/litre and diesel by ₹3/litre. Nayara Energy operates 6,967 of India’s 102,075 petrol pumps.
On Thursday, the oil ministry said India has sufficient crude supplies for the next 60 days, with higher purchases from western sources offsetting disruptions caused by the closure of the Strait of Hormuz, which is controlled by Iran.
