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New Delhi, India, March 27: The recent reduction in excise duty on petrol and diesel will primarily enable oil companies to absorb mounting losses and avert any immediate increase in fuel prices, according to Ajay Bansal, President of the All India Petroleum Dealers Association (AIPDA).
Speaking to Media, Bansal said the Centre’s move aims to cushion oil marketing companies (OMCs) against financial stress caused by surging global crude oil prices and currency fluctuations.
“The relief provided through the excise duty cut has a clear purpose: to offset the financial losses currently incurred by oil companies,” Bansal said.
He explained that the revenue sacrificed by the government will help companies bridge their under-recoveries, thereby preventing fuel price hikes that would otherwise burden consumers.
“The revenue foregone will directly support oil companies in covering existing losses. This will prevent them from passing on the burden to the public through higher prices, indirectly benefiting the common man,” he added.
Bansal highlighted that OMCs are currently selling petrol and diesel at a substantial loss due to increasing crude prices and the weakening rupee.
“Today, there is a loss of ₹45 to ₹50 per litre. International crude rates are rising and the rupee is depreciating against the dollar. Both factors are pushing up the cost for companies,” he said.
While the excise duty reduction may not immediately reflect in lower retail prices, it will help stabilise the market by preventing further hikes.
“The public will not see an immediate benefit in terms of lower prices, but they will be protected from any increase. The chances of a fuel price hike have reduced for now,” Bansal noted.
On fuel availability, he dismissed concerns about shortages, assuring that petrol and diesel supplies remain stable across the country.
“There is no shortage of any kind in supply, nor will there be in the coming days. People should not panic buy,” he said, urging the public not to circulate rumours about potential price spikes or scarcity.
“Our fuel pumps are fully operational 24 hours. We will ensure the public does not face any inconvenience,” Bansal added.
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