Petrol export duty hiked 5x, diesel export levy slashed from today

Amid growing concerns over fuel supplies during the conflict in West Asia, the government on Friday cut the windfall tax on diesel exports and raised the levy on petrol exports for the fortnight beginning October 16.

The duty on petrol exports has been increased fivefold to ₹2.50 per litre from ₹0.50 per litre, while the levy on diesel exports has been reduced to ₹8.50 per litre from ₹16 per litre. The duty on aviation turbine fuel exports has been retained at ₹10.50 per litre.

Revised fuel export duties from October 16

The Special Additional Excise Duty, along with the road and infrastructure cess, on diesel exports will now be ₹8.50 per litre. The revised rates will remain in force for the next fortnight.

The Finance Ministry said in a notification that the changes would take effect from October 16. There has been no change in the existing duty rates on petrol and diesel cleared for domestic consumption.

The latest revision follows an earlier change effective October 1, when the government reduced the diesel export duty to ₹16 per litre from ₹20 per litre while retaining the petrol levy at ₹0.50 per litre.

Why India is revising fuel export duties

The government imposed export duties on diesel and aviation turbine fuel on March 27 amid escalating tensions in West Asia and has since revised the rates every fortnight. The levy was extended to petrol exports from May 16.

India reintroduced export duties on petroleum products in March 2026 after withdrawing windfall taxes in 2024. The levies were brought back following a rise in international crude oil prices triggered by the US-Israeli war on Iran and concerns over domestic fuel availability.

The duties are intended to discourage refiners from diverting petrol, diesel and other petroleum products to overseas markets when international prices make exports more attractive. They also seek to prevent exporters from benefiting unduly from price differences after global crude oil prices rose following the outbreak of the conflict.

The government reviews the export duties every fortnight and adjusts them in response to movements in international crude oil and petroleum product prices. The latest changes apply only to fuel exports and do not, by themselves, mean that retail petrol prices will rise or diesel prices will fall at domestic fuel stations.