India Only Major Economy Where Fuel Prices Have Dropped In Recent Years: Centre

The Indian government has stated that India is the only major economy where petrol and diesel prices have decreased in recent years, attributing this to policy decisions, tax reductions, and pricing interventions by state-run oil marketing companies.

In response to a query in the Rajya Sabha, Minister of State for Petroleum and Natural Gas Suresh Gopi presented data highlighting a significant contrast between India and other nations. While fuel prices have surged in major economies like France, Germany, and the United States since November 2021, India has seen a 13.6% reduction in petrol prices and a 10.92% decrease in diesel prices.

Petrol and Diesel Prices Over Five Years

The minister provided details of fuel prices in India over the past five years, showing a peak in 2021-22 when the Indian crude oil basket averaged $79.18 per barrel, leading to petrol prices reaching ₹98.05 per litre and diesel at ₹87.42 per litre. Prices then stabilised, and as of March 2025, petrol is being sold at ₹94.74 per litre and diesel at ₹87.64 per litre in Delhi.

Gopi attributed this decline to proactive measures taken by the government, including reductions in central excise duty and rationalisation of freight costs. “The central government cut excise duty on petrol and diesel by ₹13 and ₹16 per litre respectively in two phases in November 2021 and May 2022, fully passing the benefit to consumers. Additionally, state governments also lowered VAT rates to provide further relief,” he said.

Furthermore, in March 2024, public sector oil marketing companies (OMCs) voluntarily reduced retail fuel prices by ₹2 per litre, contributing to the overall decline.

A Global Comparison

Petrol Price: A Global Comparison (Source: Rajya Sabha)

Government data reveals that while India has witnessed a decline in fuel prices, other nations have experienced significant hikes. Between November 2021 and January 2025:

• France saw petrol prices increase by 14.21% and diesel by 15.08%.
• Germany’s fuel prices rose by 7.87% for petrol and 12.43% for diesel.
• In the United States, petrol prices went up by 4.83%, while diesel saw a 12.86% increase.
• The UK had a modest increase of 0.08% in petrol and 2.61% in diesel prices.
• Canada recorded a 10.52% rise in petrol and 23.05% in diesel prices.

A similar trend was observed in neighbouring countries, with Sri Lanka witnessing the sharpest rise at 53.98% for petrol and a staggering 101.59% for diesel. Pakistan, Bangladesh, and Nepal also reported double-digit increases in fuel prices.

Measures to Keep Prices in Check

The government highlighted multiple steps taken to insulate consumers from volatile global oil prices, including:

• Diversification of crude oil imports to reduce dependency on any single region.
• Introduction of Universal Service Obligation provisions to ensure consistent fuel availability across the country.
• Increased ethanol blending in petrol to reduce reliance on crude oil imports.
• Freight cost rationalisation, which led to lower fuel prices in remote areas within states.

“These measures have ensured that despite fluctuations in global crude oil prices, Indian consumers have benefitted from stable and even reduced fuel costs,” the minister said.