Petrol and diesel prices in India are likely to be increased before May 15 as state-run oil marketing companies (OMCs) face mounting financial pressure due to a sharp rise in global crude oil prices, sources told India Today TV.
According to sources, OMCs are currently facing under-recoveries estimated at nearly Rs 30,000 crore per month as retail fuel prices remain largely unchanged despite soaring international crude rates.
Global crude oil prices have reportedly surged from around USD 70 per barrel to nearly USD 126 per barrel in recent weeks amid escalating tensions and conflict in the Middle East, raising concerns over supply disruptions and shipping risks.
Sources said the government and oil companies are presently absorbing up to Rs 24 per litre on petrol and nearly Rs 30 per litre on diesel to shield consumers from the full impact of rising crude prices.
If approved, petrol and diesel prices across India could increase by approximately Rs 4 to Rs 5 per litre, while domestic LPG cylinder prices may rise by Rs 40 to Rs 50.
The proposed revision would mark the first major increase in retail fuel prices in nearly four years, with rates having remained largely stable since 2022 despite fluctuations in global markets.
The ongoing instability in West Asia, particularly disruptions around the Strait of Hormuz — a key route through which nearly 20 percent of global oil supplies pass — has intensified the global energy crisis.
While several countries introduced emergency measures such as fuel rationing, reduced working days, and price controls to tackle shortages and rising costs, India managed to avoid major disruptions by strengthening domestic supply systems and diversifying crude imports.
Government and industry sources said India increased domestic LPG production from 36,000 tonnes per day to 54,000 tonnes per day after the crisis escalated. The Centre also reduced excise duties on petrol and diesel in an effort to limit the burden on consumers.
Despite these measures, Indian Oil Corporation, Bharat Petroleum Corporation Limited, and Hindustan Petroleum Corporation Limited are estimated to have suffered combined losses of nearly Rs 30,000 crore per month.
India also expanded crude imports from countries including Russia, the United States, and West African nations, while domestic refineries reportedly operated at more than 100 percent capacity to maintain uninterrupted fuel supplies.
Officials said the government is closely monitoring the situation in West Asia and evaluating possible options regarding the timing and extent of any fuel price hike. Authorities are reportedly trying to balance the financial sustainability of oil companies while minimising the impact on inflation and household expenses.
Officials also highlighted improvements in India’s energy infrastructure over the past decade, including the expansion of LPG terminals, diversification of crude sourcing from 27 to 40 countries, increased ethanol blending from 1.5 percent to 20 percent, and strengthening of strategic petroleum reserves.
