India Imposes ₹3/Litre Windfall Tax on Petrol Exports; Diesel, ATF Duties Reduced

The central government on Friday revised windfall taxes on petroleum product exports, imposing a fresh levy on petrol exports while lowering duties on diesel and aviation turbine fuel (ATF). The revised rates will come into effect from May 16. 

The latest changes come amid continued volatility in global crude oil markets following geopolitical tensions in West Asia and rising concerns over domestic fuel availability. 

Government Revises Export Duties on Petroleum Products 

According to a Finance Ministry notification, a special additional excise duty (SAED) of ₹3 per litre has been imposed on petrol exports. This marks the first windfall levy on petrol exports since the escalation of the West Asia conflict. 

At the same time, the government reduced the export duty on diesel to ₹16.5 per litre from ₹23 per litre earlier. The levy on aviation turbine fuel was also lowered to ₹16 per litre from ₹33 per litre. 

The notification further stated that the road and infrastructure cess on exports of petrol and diesel will remain nil. There has been no change in duties applicable to petrol and diesel meant for domestic consumption. 

The government has been periodically revising windfall taxes since March as global crude prices surged sharply following military conflict involving Iran, Israel, and the United States. 

Crude Oil Volatility Drives Policy Measures 

India first imposed export duties on diesel and ATF on March 26 to improve domestic fuel availability and prevent exporters from excessively benefiting from elevated international prices.  

Duties on diesel and ATF were subsequently revised upward in April before being partially reduced in the latest review. 

Global crude oil prices have remained above $100 per barrel in recent sessions compared to nearly $73 per barrel before the geopolitical conflict intensified. 

Fuel Prices Raised Across India 

Amid rising international crude oil prices, state-run oil marketing companies also increased retail fuel prices across the country on Friday, May 15, 2026.  

Petrol and diesel prices were raised by up to ₹3 per litre with immediate effect as companies moved to offset higher input costs caused by global market volatility. 

Read More: Maharashtra Government Cuts VAT on ATF to 7% from 18% Amid High Jet Fuel Prices! 

Conclusion 

The latest revision in windfall taxes reflects the government’s continued efforts to balance domestic fuel availability with global energy market disruptions as crude oil prices remain elevated due to geopolitical tensions in West Asia. 

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