Union Minister for Petroleum and Natural Gas, Hardeep Singh Puri on Friday said that the government has chosen to absorb the financial impact rather than pass on the full burden of rising fuel costs to consumers.
Taking it to a social media post on X, Puri said international crude prices have surged sharply over the past month, rising from around $70 per barrel to about $122 per barrel. As a result, petrol and diesel prices have increased globally.
The minister noted that prices have risen by 30-50 per cent in Southeast Asian countries, around 30 per cent in North America, 20 per cent in Europe, and about 50 per cent in African countries. The government had two options in response to the spike in crude oil prices: either pass on steep price hikes to consumers, as seen in other countries, or absorb the financial burden to shield citizens from global volatility, Puri said.
“Prime Minister Narendra Modi, in keeping with the government’s commitment over the past four years since the Russia-Ukraine conflict began, decided to take a hit on finances again to safeguard Indian citizens,” he highlighted.
He also mentioned that the government has taken a significant hit to its tax revenues to offset the losses of oil companies, estimated at around Rs 24 per litre for petrol and Rs 30 per litre for diesel, amid elevated international prices. He also said that export taxes have been imposed as global fuel prices surge. Any refinery exporting petrol or diesel will now be required to pay export tax.
Puri also expressed gratitude to Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman for what he described as a bold and visionary decision.
The Minister’s statement came soon after the government slashed excise duties on petrol and diesel by Rs 10 per litre each, bringing the levy down to Rs 3 per litre on petrol and eliminating it entirely on diesel.
The government has reduced excise duties on petrol and diesel by Rs 10 per litre each, bringing the levy down to Rs 3 per litre on petrol and eliminating it entirely on diesel.
On Thursday, the government also said India has about 60 days of oil stock cover, adding that there is no shortage of petrol, diesel, or LPG, calling reports of shortages as a “deliberate misinformation campaign” aimed at triggering panic buying.