India Hikes Windfall Tax on Diesel, Petrol and Jet Fuel

India on Monday raised windfall taxes on fuel exports, designed to ​ensure sufficient domestic supply and boost state coffers ‌at a time when prices remain volatile over the conflict in the Middle East, according to a government order.

The export duty ​on petrol has been increased to 3.5 rupees ($0.0367) ​per litre from 2.5 rupees effective immediately, the government ⁠said.

The total duty on diesel exports has been ​raised to 25.5 rupees per litre through a combination of ​two levies from 15.5 rupees a fortnight ago.

The tax on aviation fuel has been set at 22 rupees per litre up ​from 14.5 rupees from Monday.

India first imposed the windfall ​tax in July 2022 to capture extraordinary gains from soaring oil ‌prices, ⁠collecting 250 billion rupees ($2.62 billion) in 2022. Total collection fell to 130 billion rupees in 2023-24. The levy was scrapped in December 2024, but reintroduced in March 2026 ​after oil prices ​surged during ⁠the U.S.-Israeli war on Iran.

Oil prices have been volatile since the last revision of ​the taxes two weeks ago. The price ​of ⁠the commodity fell more than 5% on Monday after U.S. President Donald Trump held off on a fresh attack on ⁠Iran ​in the hope of sealing a ​quick deal.

($1 = 95.3375 Indian rupees)