Excise duty on petrol reduced to ₹3 per liter, zero on diesel amid Middle East tensions

March 27, 2026

New Delhi: The Indian government has revised the excise duty structure on fuel. The special additional excise duty on petrol has been reduced to ₹3 per liter, while it has been completely abolished on diesel. This move comes amid disruptions to global oil supplies due to the Middle East conflict, as Iran tightens control over the Strait of Hormuz.

The government order states: “The additional excise duty on petrol has been reduced from ₹13 per liter to ₹3 per liter, while the duty on diesel has been reduced from ₹10 to ₹0.”

Previously, after the April 2025 amendment, excise duty was ₹13 per liter on petrol and ₹10 per liter on diesel.

Crude oil prices fall after Iran-US talks

Global crude oil prices fell on Friday after the US said that talks with Iran were progressing “at a good pace” and the deadline had been extended by 10 days.

Brent crude, which had reached $108 per barrel, fell to $105.75 per barrel, a decline of 2.08%. Meanwhile, West Texas Intermediate (WTI) fell 1.94% to $92.67 per barrel. Prices had risen earlier in the session due to uncertainties surrounding the Strait of Hormuz, but they are still well above the pre-conflict levels of $70 per barrel.

Private fuel retailers raise prices

On Thursday, India’s largest private fuel company, Nayara Energy, raised petrol prices by ₹5 per liter and diesel by ₹3 per liter. The company operates 6,967 of the country’s 102,075 petrol pumps. The company said the increase was made to partially offset rising costs.

Impact on consumers

The government’s duty reduction is intended to provide immediate relief to consumers. Experts say this relief is temporary, and oil prices may fluctuate further depending on global market and geopolitical events.