On May 15, India raised petrol and diesel prices by ₹3 per litre, marking the first increase in nearly four years. This adjustment comes amid global fuel price surges due to geopolitical tensions, particularly the US-Iran conflict affecting oil shipments through the Strait of Hormuz. Despite the increase, India’s price hike is the smallest among major economies, reflecting a deliberate strategy to shield consumers from the full impact of rising crude oil costs. For 76 days, Indian public sector oil companies maintained stable prices, absorbing losses of approximately ₹1,000 crore daily, leading to significant under-recoveries—₹26 per litre for petrol and ₹82 per litre for diesel.

The Indian government opted not to pass on the full price increase to consumers, recognizing that a drastic hike could severely impact the poorest segments of society. Instead, it has implemented measures such as cutting excise duties and encouraging voluntary conservation to manage the economic fallout. This approach contrasts sharply with over 82 countries that have resorted to emergency restrictions or sharp price hikes. As a result, India's current account deficit remains below 1.5%, showcasing stronger macroeconomic indicators compared to past crises.