Fuel prices jump as petrol and diesel rise by Rs 3, CNG by Rs 2

Petrol and diesel prices were increased by around Rs 3 per litre across India on Friday as state-run oil marketing companies (OMCs) grapple with mounting losses triggered by soaring global crude oil prices amid the escalating West Asia crisis.

Retail fuel prices had largely remained unchanged since April 2022, barring a one-time Rs 2 per litre cut in petrol and diesel prices announced in March 2024. India had until now avoided raising pump prices by absorbing the pressure through state-run OMCs, tax adjustments and supply management measures.

However, with key state elections now concluded, oil companies have finally passed on the rising crude oil burden to consumers through the latest fuel price hike.

The revised prices came into effect immediately, with fuel rates in Delhi seeing petrol climb by Rs 3.14 per litre to Rs 97.77, while diesel rose by Rs 3.11 per litre.

Compressed Natural Gas (CNG) prices have also been revised upwards. From Friday, consumers in Delhi will pay Rs 79.09 per kilogram for CNG after a Rs 2 per kilogram increase.

The hike comes as Indian fuel retailers struggle to absorb the sharp rise in international crude oil prices, which have surged beyond the $100-per-barrel mark due to fears of prolonged supply disruptions linked to tensions involving Iran and the United States.

According to Sujata Sharma, Joint Secretary in the Union Petroleum Ministry, the combined under-recovery on petrol, diesel and LPG has now reached nearly Rs 30,000 crore per month.

She said OMCs were continuing to purchase crude oil at elevated prices while refraining from fully passing on the burden to consumers, placing significant pressure on their finances.

Sharma also noted that the Centre had already reduced excise duties on petrol and diesel, resulting in a monthly revenue sacrifice of nearly Rs 14,000 crore, but losses for fuel retailers continued to widen.

Earlier this week, Petroleum Minister Hardeep Singh Puri warned that persistently high crude oil prices could wipe out the entire FY26 profits of India’s state-run fuel retailers.

Addressing the CII Annual Business Summit 2026, Puri said the ongoing Middle East conflict had intensified financial stress on the sector, with public sector OMCs currently losing close to Rs 1,000 crore every day.

He estimated that combined quarterly losses for the companies could touch nearly Rs 1 lakh crore if crude oil prices remain elevated at current levels.

The minister cautioned that a single quarter of losses under prevailing market conditions could erase the full-year profit after tax of the OMCs for FY26.

Industry estimates cited during the summit suggested that Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation together could post losses of around Rs 1.2 lakh crore in the first quarter of FY27 if the crisis persists.

With IANS inputs