Will Petrol, Diesel Prices In India Rise By ₹25–28 Per Litre After Bengal, Tamil Nadu Assembly Elections 2026?
Petrol, diesel price in India Today: Petrol and diesel prices in India could see a sharp increase after the ongoing Assembly elections in West Bengal and Tamil Nadu conclude, with a potential hike of ₹25–28 per litre on the cards. According to Kotak Institutional Equities’ report cited by CNBCTV18, petrol and diesel prices in India are likely to rise sharply when the current Assembly elections rage on. A likely increase of ₹25-28 per litre may occur due to a combination of rising global crude oil prices and growing financial constraints for oil marketing companies (OMCs).
Petrol, diesel price in India: Reasons fuel prices may increase significantly
Ongoing volatility in the global crude oil market has occurred as a result of increased regional tension in West Asia, particularly in the area of the Strait of Hormuz (which is a major channel through which about 20% of global oil production flows). Disruptions in this area have forced producers to restrict output, leading to increased prices for crude oil.
In the past month, crude oil prices have risen substantially to around $120 per barrel (the highest level in 4 years), before settling down to about $100 per barrel. Thus far, retail fuel prices in India have remained flat, leading to an increasing divergence between global crude oil costs and retail price levels within India.
As per Kotak Institutional Equities, this disparity between global crude oil costs and domestic fuel prices is becoming unsustainable, especially for state-run refiners that are currently absorbing the losses.
Petrol, diesel price in India: Why are fuel prices still not changing
Fuel prices in India have been holding fairly steady during the most recent weeks of the election cycle. Traditionally, during an election season, adjustments to fuel prices halt until after election season ends due to inflation fears.
This delay in price adjustments has caused a significant burden to importers of crude oil in India. According to estimates from CNBCTV18, on average India’s crude import bill has increased by $190–210 million per day due to 13–15% decline in crude volumes purchased.
The financial hardship is even amplified for oil marketing companies, who Kotak estimates are incurring an additional burden of ₹270 billion monthly as a result of the current disparity between crude oil costs and retail price for fuel.
Petrol, diesel price in India: Current Fuel Prices In Major Cities
As of current prices for major cities are as follows:
Delhi- Petrol ₹94.77/litre| Diesel ₹87.67/litre
Mumbai- Petrol ₹103.49/litre|Diesel ₹90.03/litre
In cities like Bangalore/Hyderabad and Kolkata; petrol price remains above ₹100 per litre.
Petrol, diesel price in India: Factors Driving Fuel Prices in India
Several factors affect the price of fuel in India. These include:
1. Cost of Crude Oil in the International Market
2. Exchange rate of Rupee to US Dollar
3. Taxes imposed by Central and State Governments
4. Transportationand Distribution Costs
Since India imports the majority of its crude oil, any movement in the price of crude oil internationally impacts the price of fuel domestically.
Petrol, diesel price in India: Analysis Of The Price Movement Of Petrol And Diesel in India (2004 To 2026)
2004-2010: Price of Fossil Fuels (Petrol and Diesel) Relatively Low (30 to 50 in INR) Due to Government Regulation And Subsidies.
2010-2014: Prices Suddenly Increased Due To Worldwide Crude Oil Surge
2014-2016: Price Reduction Because Of Lower Cost Of Crude Oil Distribution Around The World For A Brief Period
2017 to 2022: Huge Increase In prices due primarily to Increased Taxes, And Price Volatility of Crude Oil
2023 – 2026: Price Stabilisation And Long Term Increase Due To Global Geopolitical Developments Affecting Crude Oil Production; Also, By Currency Fluctuation In The U.S.
Petrol Prices in India (2004–2026)
(₹ per litre, approx. average)
| Year | Petrol Price (₹/L) |
|---|---|
| 2004 | 34 |
| 2005 | 38 |
| 2006 | 41 |
| 2007 | 44 |
| 2008 | 51 |
| 2009 | 48 |
| 2010 | 52 |
| 2011 | 63.77 |
| 2012 | 68.57 |
| 2013 | 72.26 |
| 2014 | 72.43 |
| 2015 | 60.50 |
| 2016 | 64.38 |
| 2017 | 69.99 |
| 2018 | 78.52 |
| 2019 | 73.83 |
| 2020 | 80.43 |
| 2021 | 95.41 |
| 2022 | 95 |
| 2023 | 98 |
| 2024 | 100 |
| 2025 | 105.01 |
| 2026 | ~102 |
(Petrol prices have nearly tripled since 2004, driven by crude oil prices, taxes, and rupee depreciation)
Diesel Prices in India (2004–2026)
(₹ per litre, approx. average)
| Year | Diesel Price (₹/L) |
|---|---|
| 2004 | ~22–23 |
| 2005 | ~28 |
| 2006 | ~30 |
| 2007 | ~32 |
| 2008 | ~38 |
| 2009 | ~36 |
| 2010 | ~40 |
| 2011 | ~49 |
| 2012 | ~53 |
| 2013 | ~54 |
| 2014 | ~55 |
| 2015 | ~46 |
| 2016 | ~50 |
| 2017 | ~58 |
| 2018 | ~67 |
| 2019 | ~64 |
| 2020 | ~70 |
| 2021 | ~85 |
| 2022 | ~86 |
| 2023 | ~89 |
| 2024 | ~90 |
| 2025 | ~90–92 |
| 2026 | ~87–95 |
(Diesel has also seen a sharp rise, especially after deregulation and tax hikes.)
The cost of fuel in India has consistently increased over the past twenty years with the price of petrol rising from an average of ₹34/litre in 2004 to the current price of over ₹100/litre which makes it one of the largest contributors to the expense of households and to inflation.
Petrol, diesel price in India: Potential Impact If A ₹25-28 Increase In Petrol Prices Is Confirmed
If the expected increase in petrol price is, indeed, confirmed, then the price per litre to be paid at many stations will rise to between ₹120 and ₹130 per litre. This increase in petrol price will cause subsequent increases in many additional expenses because:
With Higher Fuel Prices, There Is Typically An Associated Increase In:
1) Transportation & Logistics Costs
2) Goods & Service Cost
3) Delivery & Travel Costs
4) Providing Additional Pressure On Household Budget
Simply put, when there is a spike in petrol price at the pump, it often means an increase in the daily living expenses for everyone.
Petrol, diesel price in India: Government response has been limited so far
The government has been making some attempts to alleviate pressure on prices through such steps as cutting the excise duty on fuel to Rs 10 per litre and reintroducing windfall taxes for fuel exports, but Kotak feels these measures do not give much overall relief, nor entirely make up the price differential.
Petrol, diesel price in India: What’s next?
According to Kotak Institutional Equities (as quoted by CNBCTV18), as long as refiners continue to suffer huge losses, this cannot continue long-term. Therefore, once elections are over, it is likely that we will see an immediate correction in prices.
However, with persistent geopolitical tension, supply chain disruptions and uncertainty, the expectation is that crude oil prices will remain high for the foreseeable future, thus providing continued upward pressure on fuel prices.
Although current fuel prices remain somewhat stable, there are numerous global and domestic factors that indicate that we could see an increase in fuel prices sooner than thought possible; both consumer and market participants will be closely monitoring this situation.
Also Read: Fashion Entrepreneur Fund Ropes in Rohit Dhar as Chief Business Officer
The post Will Petrol, Diesel Prices In India Rise By ₹25–28 Per Litre After Bengal, Tamil Nadu Assembly Elections 2026? appeared first on NewsX.
Comments are closed.