Fuel prices rose sharply across several major economies during the recent global oil disruption triggered by tensions around the Strait of Hormuz, but India’s retail increase remained among the lowest globally, according to a policy brief reviewed by The Statesman.
The brief, titled Petrol and Diesel: The Architecture of Consumer Protection, argues that India held retail petrol and diesel prices largely steady for nearly 76 days during the disruption before state-owned oil marketing companies (OMCs) introduced phased revisions in May.
The comparison comes amid renewed political debate over rising fuel prices in India following three OMC-led revisions between May 15 and May 23.
Fuel prices rose sharply across major economies
According to the document, petrol prices in countries such as Pakistan, the United States and Malaysia recorded steep increases during the February-May 2026 period linked to the Hormuz disruption.
Pakistan recorded a 54.9 per cent rise in petrol prices and a 44.9 per cent increase in diesel prices during the period, while petrol prices in the United States rose 44.5 per cent, the brief stated.
The document also cited sharp fuel-price increases in the United Arab Emirates, Sri Lanka, South Africa and several European economies.
By comparison, India’s cumulative revision stood at around 5 per cent on petrol and 5.3 per cent on diesel after the May price revisions, according to the note.
| Country | Petrol price change |
|---|---|
| Myanmar | +89.7% |
| Malaysia | +56.3% |
| Pakistan | +54.9% |
| United States | +44.5% |
| Sri Lanka | +38.2% |
| South Africa | +33.1% |
| United Kingdom | +19.2% |
| China | +21.7% |
| India | +5.0% |
Brief says India absorbed oil-price shock for weeks
The policy note stated that India absorbed the impact of higher crude prices for nearly two-and-a-half months before implementing revisions at the pump.
It claimed the cumulative increase of around ₹4.74 per litre on petrol and ₹4.82 per litre on diesel across May 15, 19 and 23 marked the first major upward movement in retail fuel prices in nearly four years.
The document further stated that the Centre had reduced excise duties multiple times since 2021 and absorbed part of the recent oil shock through revenue losses and reductions in special additional excise duty (SAED).
State VAT remains key factor in retail price variation
The brief also argued that differences in petrol and diesel prices across Indian states are primarily driven by state-level VAT structures rather than central excise duty.
According to the note, states such as Andhra Pradesh, Telangana and Kerala recorded some of the highest petrol prices after the May revisions, while Gujarat, Uttar Pradesh, Delhi and Haryana remained among the lowest.
The document described state taxation as a major reason for divergence in pump prices across the country.