Excise Duty Hike on Fuel: A Strategic Move Amid Falling Crude Prices

The central government has increased excise duties on petrol and diesel by Rs 2 per litre. The hike is not expected to impact consumers directly, as oil companies are anticipated to absorb the increase. Falling crude prices, now at USD 63 per barrel, may have influenced the decision.

In a recent fiscal maneuver, the central government has announced an increase in excise duties on petroleum products. Effective from Tuesday, petrol will see a rise of Rs 2 per litre, adjusting the total excise duty from Rs 19.90 to Rs 21.90 per litre.

Similarly, diesel will also experience an excise duty rise by Rs 2 per litre, moving from Rs 15.80 to Rs 17.80. While consumers might be concerned about potential price hikes, it is believed that major oil corporations will shoulder the increased costs without burdening the end-users.

Currently, petrol and diesel retail in Delhi at Rs 94.77 and Rs 87.67 per litre, respectively. The government's decision comes as crude oil prices have decreased significantly, dropping from over USD 70 to USD 63 per barrel, which possibly served as a catalyst for the duty adjustment.

(With inputs from agencies.)