India's Fuel Price Hike Remains Lower Amid Global Oil Surge
India saw much lower hike in petrol/diesel prices than neighbouring and other countries
China National News
Image: China National News
From February to May 2026, India experienced a modest increase in petrol and diesel prices of 4.2% and 4.4%, respectively, compared to significant hikes in neighboring countries. The government implemented several excise duty cuts to mitigate the impact of rising global crude oil prices, which surged past $120 per barrel due to the Strait of Hormuz crisis.
- 01International Brent crude oil prices surged to around $110 per barrel following the Strait of Hormuz crisis.
- 02Myanmar saw petrol prices increase by 89.7% and diesel prices by 112.7% during the same period.
- 03India's government implemented multiple excise duty reductions and retail fuel price cuts between 2021 and 2026.
- 04The March 2026 Special Additional Excise Duty (SAED) cut reduced petrol excise duty to ₹3 per litre and diesel excise duty to zero.
- 05Fuel prices vary across Indian states due to differing Value Added Tax (VAT) rates, with Andhra Pradesh, Telangana, and Kerala having the highest rates.
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India's petrol and diesel prices saw a modest increase of 4.2% and 4.4%, respectively, between February and May 2026, significantly lower than the dramatic hikes experienced in neighboring countries. This price moderation comes amidst a global surge in Brent crude oil prices, which rose to around $110 per barrel due to the ongoing crisis in the Strait of Hormuz. Countries like Myanmar reported staggering increases of 89.7% for petrol and 112.7% for diesel during the same timeframe. To cushion consumers from the impact of rising oil prices, the Indian government has implemented several excise duty reductions and retail fuel price cuts since 2021. Notably, the March 2026 SAED cut reduced petrol excise duty to ₹3 per litre and eliminated diesel excise duty. The government's adjustments, including a projected revenue impact of around ₹30,000 crore for the fiscal year, have played a crucial role in absorbing some of the price increases. Additionally, fuel prices in India vary significantly across states due to different VAT rates, with states like Andhra Pradesh and Kerala imposing higher taxes, resulting in elevated fuel costs.
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The government's measures to control fuel prices could lead to lower expenses for consumers in India, especially in states with high VAT rates.
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