Govt Hikes Excise Duty by ₹2/Litre on Petrol, Diesel

The Indian government has raised the excise duty on diesel and petrol by ₹2 a litre from April 8, 2025. Petrol will be retailed at ₹13 a litre and diesel at ₹10 a litre following the price rise. This price increase is unlikely to push petrol and diesel prices at the retail level as international crude oil prices have tanked sharply in the last one month.

The decision to increase excise duty follows in the wake of turmoil in the global crude oil market and geopolitical tension, such as with the U.S. The government seeks to stabilize the revenue flows without hurting the consumers, taking advantage of the decline in international crude oil prices to spread the duty increase.

Brent crude has dipped below $65 per barrel, while West Texas Intermediate (WTI) crude has dropped by 35% from their levels in 2025, with enough space for the duty increase without affecting retail prices. PSU Oil Marketing Companies have assured that they will be taking the duty increase through price variation without a short-term rise in retail fuel prices.

The step follows the government's policy of increasing infrastructure and lowering social welfare spending and supporting consumer-friendly fuel prices. The experts, however, caution that future price hikes in the international market are likely to have an impact on retail prices.

Overseas oil trends need to be monitored all the time.