Government cuts export duty on petrol, diesel and ATF; will domestic fuel prices come down?

It should be noted that the export duties on petroleum products are reviewed every 15 days and adjusted according to international market conditions. The last revision was carried out on May 16.

Under the new rates, exporters will pay Rs 1.5 per litre on petrol, Rs 13.5 per litre on diesel and Rs 9.5 per litre on ATF.

"In the said notification, in the Table, against serial number 1, in column (4), for the entry, the entry “Rs 9.5 per litre” shall be substituted.

2. This notification shall come into force with effect from 1st June, 2026," the centre said in the release.

The government had first imposed a Special Additional Excise Duty (SAED) and a Road and Infrastructure Cess (RIC) on exports of these fuels on March 27, 2026. The move was aimed at preventing excessive exports and ensuring adequate supplies in the domestic market amid concerns over possible disruptions in global oil supply.

A notification issued by the government said the revised levy will continue to be collected through the Special Additional Excise Duty mechanism. There has been no change in the Road and Infrastructure Cess component.

Also Read: Traders' body suggests coordinated state-level VAT relief to soften petrol & diesel price impact

New Export Duty Rates

The revised rates are lower than those announced on May 16, when the export duty stood at Rs 3 per litre on petrol, Rs 16.5 per litre on diesel and Rs 16 per litre on ATF.

This means the duty on petrol has been cut by Rs 1.5 per litre, diesel by Rs 3 per litre and ATF by Rs 6.5 per litre.

Will domestic petrol and diesel prices come down?

While the reduction may benefit exporters, it is unlikely to affect fuel prices for consumers. The government has clarified that the latest revision applies only to exports and does not involve any change in domestic excise duty on petrol and diesel.

As a result, retail fuel prices are expected to remain unchanged on account of this decision.

Fuel prices were last raised on May 25 in major cities across the country. It was the fourth increase recorded between May 15 and May 25. Following the latest hike, petrol prices in Delhi once again crossed the Rs 100-per-litre mark.

Across metro cities, petrol prices were increased by up to Rs 2.87 per litre, while diesel became costlier by as much as Rs 2.81 per litre, adding to inflation worries for households and the transport sector. For more details read here: Petrol up Rs 2.61, diesel up Rs 2.71; fourth hike since May 15; check city-wise rates