Union Petroleum and Natural Gas Minister Hardeep Singh Puri has indicated that petrol and diesel prices in India could be reduced if international crude oil prices remain low for the next few weeks, offering hope of relief for consumers amid easing global energy markets.

Speaking on the outlook for domestic fuel prices, the minister said the government and public sector oil marketing companies are closely monitoring global crude oil trends before taking a final decision. He suggested that any reduction in retail fuel prices would depend on sustained stability in international crude prices rather than short-term fluctuations.

Global crude oil prices have softened in recent weeks following easing geopolitical tensions in West Asia and the resumption of shipping through the Strait of Hormuz. The decline has led to expectations that Indian consumers could also benefit if the lower prices continue.

Despite the fall in crude prices, petrol and diesel rates at retail outlets operated by public sector oil marketing companies have remained unchanged. According to the minister, these companies are still recovering losses incurred during the period when international crude prices surged sharply, prompting a cautious approach to any immediate reduction in retail fuel prices.

Industry experts believe sustained lower crude prices would improve the financial position of oil marketing companies, making a revision in fuel prices more feasible. However, officials have indicated that any decision will be based on market conditions over the coming weeks rather than a temporary decline in global prices.

Meanwhile, the government has also revised export duties on certain petroleum products in response to changing global oil prices. Effective July 1, export duties on diesel and aviation turbine fuel (ATF) have been reduced, while the export duty on petrol has been increased to help ensure adequate domestic supplies.

Private fuel retailer Nayara Energy recently announced a reduction in petrol and diesel prices across its retail network. However, Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, which together account for the majority of the country's fuel retail market, have not announced any changes in pump prices so far.

Officials said fuel prices in India continue to be influenced by multiple factors, including international crude oil prices, exchange rates, taxes and the financial position of oil marketing companies. Consumers are now awaiting further clarity on whether the recent decline in crude prices will translate into lower retail fuel prices in the coming weeks.

Indian Oil Has One-Month Crude Stock, Profit Jumps 81% to ₹15,176 Crore

State-run refiner says no shortage despite ongoing Hormuz route disruptions; LPG sourcing shifted to Indonesia, Nigeria

Indian Oil Corporation (IOCL) has built a crude oil stockpile sufficient for over a month, the company said on Tuesday, assuring that domestic supplies remain unaffected despite continued tensions between the United States and Iran. The assurance comes as the strategically vital Hormuz Strait – through which nearly half of India’s energy imports pass – remains partially disrupted.

The public sector oil major also reported an 81 per cent surge in consolidated net profit for the January-March quarter of fiscal year 2025-26, reaching ₹15,176.08 crore compared to ₹8,367.63 crore in the same period last year.

Crude Stock Adequate

According to IOCL officials, the company holds more than one month’s worth of crude oil inventory, enough to cushion any immediate supply shocks. “We have multiple sources for crude oil and other petroleum products,” said Anuj Jain, Director (Finance) at IOCL. “All our refineries have been operating at full capacity since the Middle East dispute began.”

The Gulf region remains India’s primary energy supplier, but the ongoing conflict near the Strait of Hormuz has forced refiners to explore alternative routes and suppliers.

Hormuz Disruptions Bite

The Hormuz Strait, located between the Gulf of Oman and the Persian Gulf, handles approximately 20 per cent of global crude oil trade. The waterway’s partial closure continues to affect worldwide crude supplies, with India feeling the pinch on its liquefied petroleum gas (LPG) imports.

Officials confirmed that nearly 50 per cent of India’s energy supply and 90 per cent of its LPG imports from Gulf nations typically transit through this choke point. “Initial reports indicate that LPG stock levels have seen a marginal dip,” a source familiar with the matter said. “But the situation is being managed across the country.”

LPG Sourcing Shifted

Acknowledging supply bottlenecks, IOCL has moved quickly to secure gas from alternative markets. Following disruptions in Gulf supplies, the company initiated spot procurement from Indonesia, Nigeria, Angola and Oman.

“There were some interruptions in LPG supply,” Jain admitted, “but we have changed our import sources.” Local authorities confirmed that retail LPG distribution has not faced major shortages in any state so far, though some dealers in coastal regions reported delayed tanker arrivals last week.

Profit Surges, Dividend on Table

The company’s board recommended a final dividend of 12.5 per cent for FY26, translating to ₹1.25 per equity share of face value ₹10. The payout, however, remains subject to shareholder approval at the upcoming annual general meeting.

IOCL’s strong quarterly performance comes despite volatile crude prices and geopolitical headwinds. Market analysts attribute the profit growth to robust refining margins and lower inventory losses compared to the previous year.

Refinery Expansion Plans Underway

For the current financial year 2026-27, IOCL has earmarked a capital expenditure of ₹32,700 crore – slightly up from ₹31,401 crore spent in FY26. The bulk of this investment is directed at expanding refining capacity across three key sites.

The Panipat refinery is being expanded from 15 million metric tonnes per annum (MMTPA) to 25 MMTPA, with completion targeted by December 2026. The Gujarat refinery will see capacity rise from 13.7 MMTPA to 18 MMTPA at an estimated cost of ₹19,000 crore. Meanwhile, the Barauni refinery is set to increase from 6 MMTPA to 9 MMTPA. All three projects are expected to be commissioned around the same timeline.

Ground-level work at these sites is progressing steadily, with officials stating that land acquisition and equipment orders are largely complete. The expanded capacities are expected to reduce India’s dependence on imported petroleum products in the medium term.

Fuel Prices Hiked Again Within a Week: Petrol Up 87 Paise in Delhi

Second increase in less than a week; Kolkata sees sharpest rise of 96 paise for petrol. Oil companies cite rising crude prices and monthly losses of ₹30,000 crore.

For the second time in under a week, petrol and diesel rates have been hiked across major Indian cities. Effective Tuesday morning, prices climbed by nearly 90 paise per litre on average, adding to the burden on consumers already reeling from a ₹3 per litre increase last Friday.

According to revised price notifications from state-run oil marketing companies, the latest revision varies slightly by city. In the national capital, petrol became costlier by 87 paise, touching ₹98.64 per litre. Diesel followed suit with a 91 paise hike, now retailing at ₹91.58.

Kolkata records steepest jump

Eastern India felt the maximum pinch. Kolkata saw petrol prices rise by 96 paise – the sharpest among all metros – pushing the rate to ₹109.70 per litre. Diesel there climbed 94 paise to ₹96.07.

Mumbai, the country’s financial hub, wasn’t far behind. Petrol now costs ₹107.59 per litre (up 91 paise), while diesel rose 94 paise to ₹94.08. In Chennai, petrol crossed ₹104.49 after an 82 paise increase, and diesel touched ₹96.11.

Ripple effects on household budgets

The diesel hike is particularly worrying for common households. Transporters and logistics operators are expected to pass on the increased fuel cost directly to consumers.

Freight charges for trucks and tempos will rise, making vegetables, fruits and groceries from other states more expensive. Farmers running tractors and irrigation pumps will also face higher input costs, which could push up grain prices. Public transport users may see bus and auto-rickshaw fares going up in the coming days.

“Every diesel hike hits the last-mile delivery of essential items,” a Delhi-based transporter said, requesting anonymity. “We have no option but to revise freight rates.”

Why oil companies raised prices

Officials familiar with the matter attribute the back-to-back revisions to volatile crude oil prices in international markets. Benchmark rates, which hovered around $70 per barrel before recent West Asian geopolitical tensions escalated, have now surged past $100.

State-owned Indian Oil, Bharat Petroleum and Hindustan Petroleum were reportedly incurring combined losses of nearly ₹30,000 crore every month on sale of petrol, diesel and LPG, according to a recent statement by petroleum ministry joint secretary Sujata Sharma. The latest hikes are aimed at partially recouping those losses.

Stable for months, now two hikes in days

Fuel prices had remained unchanged since March 2024, when the government – just ahead of the Lok Sabha elections – provided relief by cutting rates by ₹2 per litre. That stability continued even as neighbouring countries like Pakistan, Nepal and Sri Lanka raised prices by 15-20% following the global crude surge.

Technically, oil companies are allowed to adjust rates daily based on a 15-day rolling average of international crude. But political sensitivity kept prices frozen for over a year. Tuesday’s revision signals a shift in that approach.

Modi’s call for conservation

On Sunday, Prime Minister Narendra Modi, speaking at an event in Telangana, urged citizens to use petroleum products judiciously, given the geopolitical situation in West Asia.

“Today’s need is to use petrol, gas and diesel very carefully,” the PM said. “We should use imported petroleum products only as needed. This will save foreign exchange and reduce the adverse effects of war.”

If crude prices remain elevated, further fuel hikes cannot be ruled out in the coming weeks.