India has adjusted windfall export duties on key refined fuels, cutting levies on diesel and aviation turbine fuel while raising the duty on petrol, according to a government order issued Tuesday. The changes are scheduled to take effect on July 1.
The specific adjustments are as follows:
- Diesel: export duty lowered to 8.5 rupees per liter from 14 rupees per liter.
- Aviation turbine fuel (ATF): export duty reduced to 7.5 rupees per liter from 12.5 rupees per liter.
- Petrol: export duty increased to 4 rupees per liter from 1.5 rupees per liter, a change the government said is intended to safeguard domestic supply.
The adjustments come as forecasters have moderated expectations for oil next year. Economists and analysts now project Brent crude will average $84.50 per barrel in 2026, down from a previous forecast of $90.44 per barrel issued last month.
Recent moves in global oil markets provide context for the duty changes. Oil prices have fallen from earlier peaks that topped $126 per barrel after geopolitical tensions eased and shipping through the Strait of Hormuz returned to normal, reducing concerns about prolonged supply disruptions. Those market dynamics are cited in connection with both the lower export levies on diesel and ATF and the lowered price outlook for Brent.
The government order sets the new rates to apply from July 1, aligning the timing of the fiscal changes with evolving market conditions. Officials framed the increase in the petrol export duty as a measure to ensure adequate domestic availability of motor fuel.
For exporters and domestic stakeholders, the combination of reduced duties on diesel and aviation fuel and a higher duty on petrol may alter incentives around shipments abroad and the domestic allocation of refined products. The revised Brent forecast and the easing of earlier supply concerns are cited in analysts' projections that informed the recalibration of export levies.
Market participants and observers will watch the implementation of the new rates beginning July 1 and monitor crude and refined product price moves as the second half of the year progresses.