India Prepares to Curb Fuel Price Volatility Amid Middle East Tensions

The Indian government has announced plans to keep fuel prices under control amid rising tensions in the Middle East. The conflict has led to an increase in oil and gas prices, which would have otherwise put pressure on consumers.

To mitigate this impact, the government had previously reduced special additional excise duty on petrol and diesel by Rs 10 per litre earlier this year. This move resulted in a revenue loss of around Rs 1.23 lakh crore to the government in the financial year 2026-27.

The reduction in duty helped offset the under-recoveries being absorbed by public-sector oil marketing companies, enabling them to supply fuel without disruption. The minister stated that the government will continue to adopt appropriate fiscal and administrative measures to mitigate the impact of future fuel price volatility while maintaining fiscal sustainability.