India Holds Fuel Prices Amid Iran War, OMC Losses Surge

Despite global hikes triggered by the Iran war, India fuel prices remain unchanged, with oil firms absorbing mounting daily losses.

India has, so far, held the line on retail fuel prices even as global markets reel under the impact of the ongoing Iran war, a move that has insulated consumers but triggered mounting financial stress for state-run oil companies.

Petrol and diesel rates have remained unchanged across the country since late February 2026, when the conflict began disrupting key crude supply routes, particularly through the Strait of Hormuz. The decision stands in sharp contrast to trends seen worldwide, where governments have largely passed on rising costs to consumers.

Global prices surge

Across international markets, crude oil prices have seen sharp fluctuations over the past two months. Brent crude briefly climbed to around $126 per barrel amid supply concerns linked to shipping disruptions.

Data from global fuel trackers indicate that more than 120 countries have raised retail fuel prices since the conflict escalated. In parts of South and Southeast Asia, price increases have ranged between 30 and 50 per cent. North America has recorded hikes of roughly 30 per cent, while Europe has seen increases of about 20 per cent.

Closer home, countries such as Pakistan, Bangladesh and Sri Lanka have reported record fuel price revisions, reflecting the broader global trend.

India bucks the trend

India’s approach has been markedly different. Retail fuel prices have effectively remained at levels last revised in May 2022, offering relief to households and businesses already dealing with broader economic pressures.

Officials say the decision is aimed at shielding consumers from volatility in global energy markets. Fuel costs in India have a cascading impact on transportation, logistics and food prices, making them a politically and economically sensitive issue.

“Protecting citizens from sudden inflationary shocks remains a priority,” a government source familiar with the policy thinking said, adding that alternative measures were being used to manage the fiscal burden.

Mounting OMC losses

However, the stability has come at a steep cost. State-owned oil marketing companies — Indian Oil Corporation, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited — are bearing significant under-recoveries.

Initial government estimates suggested that these companies were incurring combined losses of around ₹2,400 crore per day, as they continued to sell fuel below cost. At one stage, under-recoveries were pegged at approximately ₹26 per litre on petrol and as high as ₹81.90 per litre on diesel.

While subsequent excise duty adjustments have offered some relief, industry insiders say the financial strain remains considerable.

Government’s balancing act

The Centre appears to be walking a tightrope between fiscal prudence and inflation control. Petroleum and Natural Gas Minister Hardeep Singh Puri had earlier indicated that the government was consciously absorbing part of the global price shock rather than passing it on to consumers.

According to officials, reduced excise collections and indirect support to oil firms are part of this strategy. The broader objective is to prevent a ripple effect on essential commodities, especially in rural and semi-urban markets where fuel-driven inflation tends to hit hardest.

Inflation concerns linger

Economists point out that a sudden increase in fuel prices could push up wholesale and retail inflation, complicating macroeconomic management. Diesel, in particular, plays a crucial role in transporting agricultural produce and manufactured goods.

“Any sharp revision would have a near-immediate impact on supply chains,” said an analyst tracking energy markets, noting that India’s consumption patterns make it more vulnerable to fuel-linked inflation than some developed economies.

Possibility of revision

Despite the current freeze, the government has not ruled out a future price revision. Sources indicate that if global crude prices remain elevated for an extended period, adjustments may become inevitable.

As of now, petrol in Delhi is priced at ₹94.72 per litre, while diesel stands at ₹87.62. These rates have held steady even as international benchmarks remain volatile.

For now, India fuel prices continue to reflect a policy choice prioritising consumer stability over short-term fiscal comfort. How long this balance can be sustained, however, remains an open question.

Govt to Release March 2025 Inflation Data Today: New CPI Basket Includes OTT, Airfares

Consumer Price Index shift to 2024 base year adds 59 new items; March numbers due at 4 pm amid high oil price concerns.

The Ministry of Statistics and Programme Implementation will release India’s retail inflation data for March 2025 at 4 pm on Monday, 13 April 2026. This is the third monthly inflation print under the new base year 2024, which replaced the previous 2012 series.

New CPI Basket Unveiled

The government has expanded the inflation basket from 299 to 358 items. Officials added 49 new products, taking the total to 308, while services increased from 40 to 50. New inclusions now track rural house rent, CNG, PNG, OTT subscription fees, airfares, railfares, and mobile tariffs. The move aims to reflect current consumption patterns more accurately.

How Retail Inflation Is Calculated

The Consumer Price Index measures price changes in everyday goods, fuel, and services. Inflation rises when demand outpaces supply. Under the new series, weightages have been realigned to capture rural and urban spending habits better. According to officials, the updated methodology provides a truer picture of household cost pressures.

February Inflation Already on the Rise

National Statistical Office data showed retail inflation climbed to 3.21% in February 2026 from a revised 2.74% in January. Rural inflation stood at 3.37%, while urban segments recorded 3.02%. Sources indicated that March figures may extend this rising trend for the fifth consecutive month.

Iran War Impact Looms Large

Crude oil prices surged 71% during the six-week Iran conflict, jumping from $70 to a brief high of $120 per barrel. The Reserve Bank of India’s April 2026 Monetary Policy Committee warned that high oil prices and weather disturbances could push FY27 inflation to 4.6%, significantly higher than FY26’s 2.1%. Governor Sanjay Malhotra noted that imported commodities from Gulf nations face cascading price pressures.

What the New Numbers Will Reveal

Economists tracking this English News Portal India update expect March 2025 inflation to test the RBI’s upper tolerance level if fuel costs pass through fully. The government maintains that domestic food supplies remain adequate. However, global crude volatility remains a key monitorable.

What Next for Policy and Public

The RBI’s next policy response will depend on whether March data shows sustained momentum. Analysts say another uptick could delay any rate cut cycle. For the public, dearer transport, entertainment, and housing rent may follow if oil stays elevated. The ministry will release the full dataset with rural-urban breakups by evening.

Only 7-14 Days of Natural Gas Left in India Amid Iran War

With LNG shipments stalled through the Strait of Hormuz, imported stocks are critically low and the government has already invoked emergency supply rules to protect households while industries brace for cuts.

Days of natural gas left in India have shrunk to just one or two weeks for the imported portion as the Iran war disrupts key routes, officials and analysts confirm. Domestic production covers roughly half the needs, but the other half — reliant on LNG — now faces real pressure. Households using piped natural gas (PNG) need not panic yet, yet price hikes loom if the conflict drags on.

PNG Network Expands Rapidly

Urban families continue switching from LPG cylinders to PNG for convenience and steady supply. India has crossed 1.5 crore PNG connections, with fresh additions of over 1.25 lakh in the past two weeks alone. City gas distribution projects are accelerating, and CNG remains the second-most popular auto fuel after petrol.

The shift gained speed after LPG supplies tightened. More than 5,600 households moved from cylinders to PNG in just three days, according to petroleum ministry updates.

Supply Sources Breakdown

Roughly half the gas feeding PNG networks and city distribution comes from domestic fields operated by ONGC and Reliance in the KG basin. The remaining half arrives as LNG, mostly under long-term contracts with Qatar.

Nearly 70 per cent of these imports must sail through the Strait of Hormuz. Smaller volumes from the US, Australia and Russia provide some diversification, yet the Gulf route dominates.

Hormuz Chokepoint Threat

The narrow waterway has become the focal point of the Iran war. Qatar’s Ras Laffan terminal — source of over half India’s LNG — halted fresh loadings after the conflict escalated. Cargoes already at sea are reaching Indian terminals, but future shipments remain uncertain.

Shipping data show delays and rerouting. Industry trackers report that even Petronet’s captive tankers faced hold-ups at Dahej, leaving some terminals with just days of buffer.

Limited Storage Buffer

Unlike crude oil, India maintains no strategic gas reserves. Stocks sit only as working inventory at regasification terminals in Dahej, Hazira, Kochi and Ennore. These cover at most one to two weeks of imports — or roughly 9-12 days of total consumption in some estimates.

Recent tenders for March LNG cargoes went unawarded as prices spiked above $25 per million Btu. Terminal operators now operate with minimal cushion.

Priority for Households

The government has issued the Natural Gas Supply Regulation Order 2026 to ring-fence essential users. Households with PNG connections and fertiliser plants rank highest. Power plants and industries will feel the squeeze first and may switch to fuel oil, coal or LPG.

Officials are urging conservation and faster PNG adoption to ease pressure on LPG, which already serves 33.37 crore consumers and faced earlier disruptions.

Price Hike Warnings

Shortages may not hit kitchens immediately, but costs will rise. Market response to Hormuz risks has already pushed LNG prices higher. PNG distributors will pass on increases to urban consumers, while factories absorb deeper cuts or pay premium rates for alternatives.

Experts from Global Trade Research Initiative note that prolonged disruption will force both households and industry to pay more. No outright rationing is expected for domestic PNG, yet bills are set to climb.

Energy Security Outlook

The crisis has revived talk of strategic LNG storage. Policymakers are studying extra tanks at existing terminals and a 10 per cent government-accessible buffer. Pipeline expansion to 25,000 km and new city gas projects continue, yet import dependence remains a weak spot.

As the Iran war enters a critical phase, the coming weeks will test India’s ability to balance supply, price and priority use. With days of natural gas left in India under close watch, the government is monitoring global cargoes and domestic output round the clock. Any extension of the conflict will likely bring higher PNG tariffs and renewed push for local exploration and renewables.

Iran War Impact: LPG Crisis May Force Indian Restaurants to Drop Dosa, Uttapam From Menus

The Iran war impact is now reaching Indian kitchens, with restaurants across the country warning that popular dishes such as dosa, uttapam and other South Indian staples could soon disappear from menus due to a growing shortage of commercial LPG cylinders.

Restaurant owners in several major cities say they have only two to three days’ worth of cooking gas left, raising fears that operations may be halted if fresh supplies do not arrive soon. The crisis comes as global energy supply chains face disruption amid escalating tensions in West Asia.

Strait of Hormuz Disruption Hits LPG Imports

India is the world’s second-largest importer of liquefied petroleum gas (LPG), and nearly 90% of its LPG shipments pass through the Strait of Hormuz, a critical global energy route.

However, the ongoing conflict in the region has slowed maritime traffic through the strategic waterway, causing delays in LPG shipments to India. The resulting supply crunch is already affecting sectors heavily dependent on commercial LPG, including restaurants, manufacturers and power plants.

To ensure essential services continue, the government has prioritised LPG supplies for households, leaving commercial users such as restaurants struggling to secure enough fuel for daily operations.

Food Delivery Platforms See Sharp Decline

The impact of the LPG shortage is also visible in India’s food delivery ecosystem. According to the Gig & Platform Service Workers Union, deliveries on major platforms like Zomato and Swiggy have reportedly fallen by 50–60% in recent days.

Nirmal Gorana, National Co-ordinator of the union, said several gig workers have reported declining earnings as restaurants reduce operations or temporarily stop accepting orders.

Families of delivery workers have even approached the union, expressing concerns about meeting basic household expenses due to the sudden drop in income.

Restaurants Struggle to Stay Open

Restaurant owners say the crisis is already affecting daily operations.

At Guerilla Diner in Bengaluru, reservations usually fill up within minutes each week. But now the restaurant is exploring ways to operate without relying heavily on gas.

Ownersaid the kitchen currently has only 2.5 LPG cylinders left.

Black Market LPG Prices Surge

Industry leaders say the shortage has already led to sharp price increases in the black market.

Ananth Narayan, head of the Bengaluru chapter of the National Restaurant Association of India (NRAI), warned that commercial LPG cylinder prices have nearly doubled in unofficial markets.

Meanwhile, Prime Minister Narendra Modi has urged citizens not to panic and announced the formation of a committee to review requests from the hospitality sector for additional LPG supply.

Restaurants Alter Menus to Save Gas

To cope with the crisis, many restaurants are already modifying their menus and cooking techniques to reduce gas consumption.

The NRAI has advised restaurants to:

 Pre-soak grains to reduce cooking time

 Remove dishes requiring slow cooking or deep frying

 Limit menu items that need long steaming processes

In Mumbai, the Chinese restaurant Gypsy has temporarily removed steamed dim sum from its menu because the dish requires continuous gas usage for nearly 10 minutes per serving.

Some Restaurants Return to Traditional Cooking

With gas becoming scarce, a few eateries have started returning to traditional wood-fired cooking methods.

At The Pizza Bakery, staff say weekly firewood usage has increased significantly as gas burners used to maintain oven heat have been switched off.

Uncertainty Looms Over Restaurant Industry

Restaurant owners warn that if the Iran war impact on energy supply chains continues, the hospitality sector could face serious disruptions.

Basic breakfast items such as omelettes and pancakes may also become difficult to prepare if gas supplies remain tight.

For now, the industry is hoping for quick government intervention and stabilisation of LPG imports. Until then, many restaurant kitchens remain on edge — unsure whether their next cylinder will arrive in time to keep the stoves burning.