Business Desk – Fuel Export Duty Cut: Amidst the ongoing tension in the Middle East, the Central Government has reduced the duty on export of petrol-diesel and Aviation Turbine Fuel (ATF). New rates have come into effect. According to the Finance Ministry, this relief has been given to Indian oil marketing companies for two weeks.
Under the new system, export duty on petrol has been reduced by Rs 1 per liter, on diesel by Rs 5 and on ATF by Rs 4 per liter. There has been no change in the excise duty on petrol and diesel in the domestic market.
Now how much export duty will be imposed on petrol, diesel and ATF?
Export duty on petrol has been reduced from Rs 1.5 to Rs 0.5 per litre. Duty on diesel has reduced from Rs 25 to Rs 20 per litre. At the same time, export duty on ATF has been reduced from Rs 19 to Rs 15 per liter.
Apart from this, RIC of Rs 1 per liter on export of diesel has also been removed. The government had earlier increased the cess on diesel export from zero to Rs 1 per liter from September 1.
Excise duty not changed in domestic market
Reduction in export duty does not mean direct reduction in the prices of petrol and diesel in the domestic market. The government has not made any changes in the excise duty for domestic consumption.
The government had imposed some export restrictions from March 27, 2026 to maintain the availability of petrol and diesel in the country amid tensions in West Asia. Now relief has been given to oil companies through temporary reduction in export duty.
India imports oil, then why export?
India fulfills a major part of its requirement through import of crude oil. Products like petrol, diesel and ATF are made by processing imported crude oil in refineries in the country.
A part of these petroleum products is used in the domestic market, while the remaining part is exported abroad. India is among the major exporters of refined petroleum products.
How will oil companies get benefit?
The direct benefit of reduction in export duty will be given to those oil marketing companies which export petroleum products abroad. Due to reduced duty, they will have to pay less tax on exports than before. This may provide relief to the margins of companies.
Amid the rise in crude oil prices, cost pressure on oil companies has also increased. In such a situation, this two-week relief from the government opens the way for companies to reduce additional costs in export business.
