Center cuts petrol, diesel and ATF export duty from June 1, domestic fuel tax remains unchanged

The Central Government has amended the export duty on petroleum products for the fortnight starting from June 1. The government has reduced the duty on export of petrol, diesel and aviation turbine fuel (ATF). However, there has been no change in the excise duty on petrol and diesel sold in the domestic market, which is expected to provide relief to consumers and maintain stability in retail fuel prices.

According to the official notification issued by the government, from June 1, a duty of Rs 1.5 per liter will be applicable on petrol exports, Rs 13.5 per liter on diesel exports and Rs 9.5 per liter on Aviation Turbine Fuel (ATF) exports.

Relief for domestic consumers

The government has clarified that there has been no change in the existing excise duty rates on petrol and diesel sold within the country. This means that the fuel tax structure in the domestic market will remain the same and this decision is unlikely to have a direct impact on retail fuel prices.

Experts believe that the purpose of keeping domestic taxes stable is to provide relief to consumers and prevent unnecessary fluctuations in fuel prices.

Review based on international prices

The government reviews the average prices of crude oil, petrol, diesel and ATF in the global market every fortnight. On the basis of this review, the export duty is revised.

The previous amendment came into effect from May 16, when the government had imposed special additional excise duty (SAED) of Rs 3 per liter on petrol exports and reduced diesel export duty to Rs 16.5 per litre.

Export duty reduced continuously in last two months

The export duty imposed on diesel and ATF has been changed several times in the last few months. Diesel export duty was fixed at Rs 21.5 per liter on March 26. Later on April 11, it was increased to Rs 55.5 per liter as concerns over domestic fuel availability increased at that time.

After this, on April 30, this duty was reduced to Rs 23 per liter and then it was further reduced gradually. Now the new rate has been fixed at Rs 13.5 per litre.

Similarly, the export duty on ATF was initially imposed at Rs 29.5 per liter, which was later increased to Rs 42 per liter. After this, by reducing it in several stages, it has now been brought down to Rs 9.5 per liter.

Why was export duty imposed?

On March 27, 2026, the Central Government had imposed export duty on petroleum products in view of the instability in the global oil market due to increasing tension and crisis in West Asia.

At that time, there were huge fluctuations in the prices of crude oil and fuel in the international market. The objective of the government was to ensure that Indian companies did not export excessively and that there was adequate availability of petroleum products within the country.

According to experts, the reduction in export duty may provide some relief to Indian refinery companies and strengthen their competitive position in the international market. At the same time, due to no change in domestic taxes, there is no possibility of any immediate major change in the retail prices of petrol and diesel for common consumers.

The government has indicated that this policy will continue to be reviewed every fortnight going forward as per the situation in the international oil market. In such a situation, export duty may be changed again in future based on global prices and geopolitical circumstances.

Overall, under the new amendment coming into effect from June 1, the government has adopted a strategy to maintain fuel price stability in the domestic market by giving relief in export duty.

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