Government Slashes Export Duty On Petrol Diesel And ATF From June 1

The Central Government has taken a major decision to provide relief to oil exporting companies by slashing the export duty on petrol, diesel, and Aviation Turbine Fuel (ATF). This new regulation is set to come into effect from June 1, 2026. According to the notification issued by the Ministry of Finance, the reduction in duties is aimed at adjusting to the current international market dynamics. However, it's important to note that this decision won't provide any direct relief to the common man at petrol pumps. The excise duty on fuel sold within the country remains unchanged, meaning the retail prices for domestic consumers won't see a decrease as a result of this specific policy shift.

New Export Duty Rates Effective June 1

The government follows a practice of reviewing tax rates every fortnight (15 days) based on the prevailing prices of crude oil in the international market. The last such review was conducted on May 16, 2026.5 per liter. 5 per liter. 5 per liter. A notable aspect of this update is that the Road and Infrastructure Cess (RIC) on the export of both petrol and diesel has been maintained at zero.

Background of the Special Export Tax

The roots of this special tax date back to earlier this year, while on March 27, 2026, the government had initially imposed this special tax on the export of petrol, diesel, and aviation fuel. This step was taken during a period of heightened tensions in West Asia and a deepening geopolitical crisis. The primary objective behind imposing these duties was to ensure that there was no shortage of petroleum products in the domestic market. By taxing exports, the government aimed to discourage companies from selling large quantities of oil abroad, thereby maintaining an adequate supply within India to meet local demand.

Current Domestic Fuel Price Scenario

While companies are receiving relief on the export front, domestic consumers continue to face the pressure of high fuel prices, while on May 25, there was a sharp jump in petrol and diesel prices, marking the fourth consecutive increase in less than two weeks. Following this hike, petrol prices in Delhi crossed the 100 mark. 20 per liter. The situation is similar across other major metropolitan cities. 82 per liter. 83 for diesel. 55 per liter. This contrast highlights that while international trade policies are being eased, the domestic retail market remains under the influence of inflationary pressures.