Petrol, diesel prices may rise in India before May 15

New Delhi: Petrol and diesel prices in India are expected to be hiked before May 15, as state-run oil marketing companies (OMCs) struggle with mounting financial losses due to a sharp rise in global crude oil prices.

According to sources, OMCs such as Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum are facing under-recoveries of nearly Rs 30,000 crore per month.

Why fuel prices may increase

• Global crude oil prices have surged from ~USD 70 to USD 126 per barrel
• The spike is linked to the ongoing Middle East conflict, impacting supply chains
• Disruptions in the Strait of Hormuz—a key oil transit route—have worsened the situation
• OMCs are absorbing heavy losses due to frozen retail fuel prices

Sources say the government and companies are currently absorbing up to Rs 24 per litre on petrol and even higher on diesel.

Expected price hike

If approved, the revision could result in:

• Petrol & diesel: Increase of around Rs 4–5 per litre
• LPG cylinders: Likely hike of Rs 40–50

This would be the first major fuel price revision since 2022, when retail prices were largely frozen despite global volatility.

India’s response to the global oil shock

Despite rising crude prices, India has so far avoided fuel shortages seen in some neighbouring countries.

Key measures taken:

• Increased LPG production from 36,000 to 54,000 tonnes/day
• Reduced excise duties to cushion consumers
• Diversified crude imports from countries like Russia, the US, and West Africa
• Refineries operating at over 100% capacity
• Expansion of strategic petroleum reserves

These steps helped maintain stable supply without rationing or long queues.

Balancing inflation vs losses

Officials indicate that the government is carefully weighing:

• The financial stress on OMCs
• The risk of rising inflation if fuel prices are increased

A final decision is expected soon, with timing and extent of the hike being closely evaluated.

Key takeaway

India may soon see a moderate but significant fuel price hike, driven by global crude shocks and sustained financial pressure on oil companies. While the increase may impact household budgets, it reflects broader global energy market realities.