India has increased windfall taxes on exports of diesel and aviation turbine fuel (ATF) and lowered the levy on petrol exports, reflecting the recent rebound in global crude oil prices.
The revised duties, announced through a Finance Ministry notification, will take effect from July 16.
Export duty on diesel has been raised to Rs 15.5 per litre from Rs 8.5 per litre, while the levy on ATF exports has been increased to Rs 14.5 per litre from Rs 7.5 per litre. The duty on petrol exports, however, has been reduced to Rs 2.5 per litre from Rs 4 per litre.
The revision follows a sharp recovery in crude oil prices this month. Brent crude has climbed about 17% in July after recording declines for three consecutive months through June. June also marked the benchmark’s biggest monthly drop since the onset of the Covid-19 pandemic in 2020.
The global benchmark gained about 2% on Wednesday to touch a one-month high of $84.73 a barrel after the United States resumed a naval blockade of Iran. The move renewed concerns over crude supplies passing through the Strait of Hormuz, a key shipping corridor that accounted for about one-fifth of global oil flows before the conflict.
Crude prices also found support from renewed geopolitical tensions and attacks on oil tankers. At the same time, worries over inflation and slowing global demand capped further gains.
Supply disruptions, including lower diesel shipments from Russia, have also pushed up diesel refining margins, adding pressure to fuel markets.
The latest changes are part of the government’s fortnightly review of the windfall tax framework.
Earlier this month, on July 1, state-owned oil marketing companies reduced ATF prices by about Rs 5 per litre after global crude prices eased as geopolitical tensions in West Asia subsided.
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