New Delhi, India – The Indian government has dramatically adjusted its fuel export duties, effective October 16, 2026. The levy on petrol exports has seen a fivefold increase, rising from ₹0.50 to ₹2.50 per litre. Conversely, the duty on diesel exports has been substantially reduced from ₹16 to ₹8.50 per litre. The export duty for aviation turbine fuel (ATF) remains unchanged at ₹10.50 per litre.
Protecting Domestic Fuel Supplies
This revision in export duties is a strategic measure by the government to safeguard domestic fuel availability, particularly during a period of heightened volatility in global crude oil prices and ongoing conflict in West Asia. By making exports less attractive for petrol and more feasible for diesel, the government aims to balance the needs of the domestic market with international pricing dynamics.
The Finance Ministry confirmed that these new rates apply specifically to fuel exports and do not affect the existing duty rates on petrol and diesel designated for domestic consumption. Therefore, retail prices for consumers within India are not directly impacted by these changes.
Fortnightly Review Mechanism
India reintroduced export duties on petroleum products in March 2026, initially targeting diesel and aviation turbine fuel, and later extending to petrol exports in May 2026. These levies were reinstated following a surge in international crude oil prices, reportedly triggered by geopolitical tensions, and an increased focus on ensuring sufficient fuel availability within the country.
The government maintains a fortnightly review schedule for these export duties, adjusting them based on fluctuations in international crude oil and petroleum product prices. This dynamic approach allows for quick responses to global market conditions, ensuring that domestic supply remains prioritized and exporters do not unduly benefit from significant price differences.
Previous Adjustments
- October 1, 2026: Diesel export duty was reduced from ₹20 to ₹16 per litre, while petrol levy remained at ₹0.50 per litre.
- May 16, 2026: Export duty was extended to petrol.
- March 27, 2026: Initial imposition of export duties on diesel and ATF amid West Asia tensions.
These duties are designed to discourage refiners from prioritizing overseas markets when international prices offer more lucrative returns, thereby ensuring a stable supply for Indian consumers.