The government on Monday announced a hike in excise duty on petrol and diesel by ₹2 per litre each. However, the move will not impact retail prices at fuel stations, as the increase will be offset against the price reduction warranted by falling global crude oil prices. 

#BreakingNews | Govt Increases Excise Duty By ₹2 Each On Petrol And Diesel pic.twitter.com/DxItXxXbyV

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Excise Duty on Petrol and Diesel Hiked by ₹2 Per Litre; No Change in Retail Prices

As per the official order, the excise duty on petrol has now been raised to ₹13 per litre, while that on diesel stands at ₹10 per litre. The revised rates will come into effect from April 8, 2025. The Ministry of Finance confirmed the adjustment through a notification released earlier today.

No Burden on Consumers Despite Duty Hike

In most cases, revisions in excise duties are passed on to the consumers, impacting the final selling price. However, this time, the government has clarified that there will be no change in the retail selling price of petrol and diesel. The hike in excise duties will be balanced out by a corresponding decline in international oil prices.

"PSU Oil Marketing Companies have informed that there will be no increase in retail prices of #Petrol and #Diesel, subsequent to the increase effected in Excise Duty Rates today," the Ministry of Petroleum and Natural Gas stated in a post on social media platform X (formerly Twitter).

The decision comes at a time when international oil markets are experiencing significant downward pressure. Brent crude fell by $2.43 or 3.7% to $63.15 per barrel, while US West Texas Intermediate (WTI) declined by $2.42 or 3.9% to $59.57 per barrel. These are the lowest crude prices recorded since April 2021, driven largely by fears of an economic slowdown amid escalating US-China trade tensions.

India, which imports around 85% of its crude oil requirements, remains highly sensitive to global price fluctuations. The current scenario presents an opportunity for the government to shore up revenue through higher excise collections without putting an additional burden on consumers.

Analysts believe this move may help the Centre bridge fiscal gaps while maintaining consumer confidence, especially in an election year. However, sustained low global oil prices will be key to keeping domestic retail prices stable in the coming weeks.