Residents across Uttar Pradesh are facing higher fuel costs as petrol and diesel prices have been revised upward by ₹3 per litre, effective May 15, 2026. This marks the first significant price adjustment since March 21, 2025, ending a prolonged period where rates were held steady.
New Fuel Rates in Major UP Cities
Following the nationwide revision by oil marketing companies, the new retail prices in key Uttar Pradesh cities are:
- Lucknow: Petrol Rate: ₹97.55/litre, Diesel Rate: ₹90.82/litre
- Noida: Petrol Rate: ₹97.55/litre, Diesel Rate: ₹90.82/litre
- Kanpur: Petrol Rate: ₹97.55/litre, Diesel Rate: ₹90.82/litre
These rates incorporate local taxes and transportation costs, which cause variations across different cities and states.
Why the Hike Now?
The timing of this fuel price increase is closely linked to the electoral calendar. Fuel prices in India have historically been stable during state election periods to avoid potential voter backlash. With the State Assembly elections 2026 now concluded, the government has moved to pass on accumulated cost pressures to consumers.
Several factors contribute to the current hike:
- Elevated Global Crude Oil Prices: International crude oil prices have remained high due to disruptions in West Asian shipping routes and ongoing tensions around the Strait of Hormuz, a critical passageway for India's oil imports.
- Weakening Rupee: The Indian rupee's depreciation against the US dollar makes crude oil imports more expensive, directly impacting the margins of state-owned oil marketing companies like Indian Oil, Bharat Petroleum, and Hindustan Petroleum.
The Ministry of Petroleum and Natural Gas previously indicated significant 'under-recoveries' for OMCs, estimating approximately ₹26 per litre on petrol and ₹81.90 per litre on diesel at current international crude prices. The combined daily under-recovery absorbed by OMCs was around ₹2,400 crore.
What Drives Fuel Prices in India?
Retail fuel pricing in India is primarily influenced by two major variables:
- International Crude Oil Prices: As India imports the majority of its crude oil, global price swings have the most substantial impact on what consumers pay at the pump.
- Rupee-Dollar Exchange Rate: A weaker rupee increases the cost of procuring crude, directly leading to higher retail prices.
Additionally, taxes levied by both central and state governments constitute a significant portion of the final price, often more than half. This is the primary reason for the variation in petrol and diesel rates across different states and cities, alongside transportation costs and local demand-supply dynamics.