India’s government has reduced export duties on key petroleum products for the fortnight starting 1 June 2026, following a periodic review linked to easing international crude oil prices.
New Delhi, India — Sunday, May 31, 2026, 2:15 PM
The Indian government announced cuts to export duties on petrol, diesel, and aviation turbine fuel (ATF) effective from Monday, 1 June 2026. The revisions, notified by the Ministry of Finance, lower the levies in response to moderating global oil prices amid reduced geopolitical tensions in West Asia.
Petrol exports will now attract a duty of INR 1.5 per litre, down from INR 3. Diesel exports will face INR 13.5 per litre, reduced from INR 16.5, while ATF exports will be taxed at INR 9.5 per litre, down from INR 16. These fortnightly adjustments are based on average international prices since mid-May.
Export Duties Cut on Petrol, Diesel and ATF
The notification specifies that petrol exports will carry only Special Additional Excise Duty (SAED) of INR 1.5 per litre, with Road and Infrastructure Cess (RIC) at nil. Diesel exports will attract SAED of INR 13.5 per litre (RIC nil), and ATF will face SAED of INR 9.5 per litre.
This marks a continued calibration of export levies first introduced in late March 2026 to prioritise domestic availability during earlier spikes in global crude prices triggered by West Asia conflicts.
Impact on Refiners and Domestic Supply
The duty reductions are expected to improve export margins for Indian refiners, who have significant overseas sales. India is a major exporter of petroleum products, and these adjustments come as domestic retail fuel prices have seen some upward movement recently but remain stable overall due to government interventions.
No changes were made to domestic excise duties on petrol and diesel, which continue to shield consumers from full international price volatility.
Nut Graph: Relevance to South Asia
For South Asia, India’s policy on petroleum products has broad implications. As a leading regional supplier of refined fuels, adjustments in India’s export regime can influence fuel availability and prices in neighbouring countries such as Bangladesh, Nepal, and Sri Lanka, which rely on Indian exports. Lower export duties may ease regional supply pressures while supporting India’s refining industry, a key economic driver amid shared energy security challenges.
Background
India introduced export levies on diesel and ATF in March 2026 at higher rates, with subsequent fortnightly revisions. Petrol exports remained largely duty-free until mid-May, when a small levy was imposed. These measures were part of a broader strategy to balance domestic needs with refinery economics during periods of elevated global crude prices, which had exceeded USD 120 per barrel at peaks.
Recent easing in international prices has allowed for these reductions, reflecting the government’s dynamic approach to windfall levies.
What’s next
The next fortnightly review is expected around mid-June 2026. Policymakers will continue monitoring global crude benchmarks, domestic demand, and monsoon-related factors. India cuts export duties signal a flexible fiscal response aimed at maintaining both consumer affordability at home and competitiveness in international markets. The move underscores ongoing efforts to manage energy costs effectively in a volatile global environment.
Published in SouthAsianDesk, May 31, 2026
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