With global crude oil prices soaring, Indian oil marketing companies (OMCs) face severe financial losses, prompting imminent price hikes for petrol and diesel. The Brent crude oil price has reached $108 per barrel, significantly impacting the operational costs for OMCs.
Petrol and diesel prices in India are likely to increase by ₹2 to ₹4 per litre soon. Currently, OMCs are losing ₹24 per litre on petrol and ₹30 per litre on diesel. This situation has become untenable as the financial pressure mounts on these companies due to the rising crude oil prices.
In April 2026, LPG consumption in India saw a notable decrease of 16.16%, falling to 2.2 million tonnes. This decline in demand reflects broader economic challenges, including inflationary pressures that impact consumer spending.
The government previously reduced excise duty by ₹10 per litre, which resulted in a significant revenue loss of approximately ₹1.7 lakh crore annually. Officials have indicated that maintaining current prices is not feasible given the ongoing supply issues.
A senior official stated, “We cannot keep prices unchanged when there are supply issues. At some point, we have to make adjustments according to market conditions.” This sentiment underscores the urgency for OMCs to recalibrate pricing strategies in response to market dynamics.
The government believes that a price adjustment is unavoidable due to the financial strain on OMCs. As such, consumers should prepare for the upcoming price changes following the election results.
The situation remains fluid as officials continue to assess the impacts of fluctuating crude oil prices on domestic fuel costs. The next move from the government regarding price adjustments is anticipated shortly after the election outcomes are announced.
