New Delhi, May 20: The government has limited the increase in petrol and diesel prices to 4.4 per cent, among the lowest rises seen across major economies, by reducing excise duty and directing public sector oil marketing companies to absorb a significant portion of the impact from soaring global crude oil prices.
According to official sources, public sector oil companies absorbed under-recoveries of around Rs 24,500 crore on petrol and diesel before implementing a cumulative price increase of Rs 3.91 per litre in two phases.
A senior official said the Centre incurred a revenue loss of nearly Rs 30,000 crore through excise duty reductions on petrol and diesel, while oil marketing companies absorbed losses of Rs 24,500 crore on transport fuels and an additional Rs 40,000 crore by keeping domestic liquefied petroleum gas (LPG) prices unchanged.
India’s oil marketing companies raised petrol and diesel prices by a total of Rs 3.91 per litre through two revisions of Rs 3 and 91 paise, respectively.
While the central excise component remains uniform across the country, retail fuel prices vary among states due to differences in value-added tax (VAT) levied by state governments.
States with relatively higher pump prices include Telangana, Kerala, Karnataka and Tamil Nadu, while lower fuel prices are seen in Gujarat, Uttar Pradesh, Delhi, Haryana, Goa and Assam.
An Indian Oil official said the Rs 3.91 increase only partially reflected the rise in international crude oil prices and came after 76 days during which public sector oil companies absorbed the entire cost escalation.
The official noted that India’s restrained fuel price adjustment stands in contrast to global trends, where several countries have witnessed significantly sharper increases in retail fuel prices.
Countries such as Myanmar, Malaysia, Pakistan and the United Arab Emirates have recorded petrol price increases exceeding 50 per cent compared to pre-war levels, with diesel prices rising even more sharply due to stronger links to freight and global trade.
Data cited by officials showed petrol prices in Pakistan have risen around 55 per cent over three months, while Malaysia and the UAE have witnessed increases of approximately 56 per cent and 52 per cent, respectively.
In advanced economies, fuel price increases have also remained elevated. Petrol prices in the United States have risen nearly 45 per cent, with diesel up 48 per cent. In Europe, petrol prices have increased by about 19 per cent in the United Kingdom, 14 per cent in Germany and 21 per cent in France, while diesel prices have risen more sharply.
Across Asia, petrol price increases in Japan, South Korea and Singapore have largely remained below 20 per cent, although diesel prices have surged considerably, including a 65 per cent rise in Singapore, according to the figures.
