India takes a ‘huge hit’ on tax revenue to keep fuel prices from surging during the Iran war

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The Indian government’s tax revenues have taken a “huge hit” after New Delhi slashed central excise duties on fuel for domestic consumption, Petroleum and Natural Gas Minister Hardeep Singh Puri said Friday.

The Indian government late Thursday cut central excise duties on petrol and diesel for domestic consumption by 10 rupees ($0.11) per liter each, to keep pump prices from rising as the Iran war disrupts global energy supplies.

International crude prices have “gone through the roof” in the last month, from roughly $70 a barrel to around $122, Puri said in a post on X.

The government has decided to bear the cost of rising energy prices and keep retail fuel prices from rising, he said, adding that these tax cuts will reduce the losses faced by oil companies, which stand at around 24 rupees per liter for petrol and 30 rupees per liter of diesel.