The petrol export duty on fuel shipped out of India has been raised fivefold to Rs 2.5 per litre from Rs 0.5, effective October 16, 2026, under a Finance Ministry notification issued as part of the government’s fortnightly review of windfall taxes. The petrol export duty hike was paired with a cut in the diesel export levy to Rs 8.5 per litre from Rs 16, while the duty on aviation turbine fuel (ATF) was left unchanged at Rs 10.5 per litre.
The revised rates cover the Special Additional Excise Duty (SAED), with no road and infrastructure cess applicable on fuel exports. Export duties on petrol, diesel and ATF are reviewed every two weeks based on the average international prices of crude oil and refined fuels since the previous review. The ministry also clarified there is no change in excise duty rates on petrol and diesel sold for domestic consumption, and that retail pump prices are therefore untouched by this notification — the higher petrol export duty applies only to outbound shipments.
Why the petrol export duty was raised
India first imposed windfall taxes on fuel exports in July 2022 to capture super-normal profits that refiners earned when global crude prices surged after the Russia-Ukraine conflict. The levies were withdrawn two years later, then reintroduced in March 2026 after crude prices jumped during the US-Israeli war on Iran. The stated purpose of the petrol export duty is to discourage exports and protect domestic fuel supplies, while preventing exporters from unduly benefiting from gaps between domestic and international prices.
The latest revision follows a seesaw of fortnightly changes. In August, the government had raised the levy on petrol exports to Rs 3.5 per litre from Rs 2.5; in September it cut the duty to Rs 0.5 per litre as part of a broader reduction covering diesel and ATF. The October 16 revision reverses part of that cut, taking the levy back up fivefold while moving diesel in the opposite direction — a split that reflects divergent international price trends for the two fuels.
Petrol export duty: what changes for diesel and ATF
For diesel, the combined SAED and road and infrastructure cess on exports now stands at Rs 8.5 per litre, down from Rs 16 — a cut of nearly 47 per cent that continues the downward trend from September’s review. The ATF export duty stays at Rs 10.5 per litre for the fortnight beginning October 16, unchanged from the previous revision.
The opposite-direction moves in the petrol levy and the diesel duty are unusual but not unprecedented: the fortnightly formula tracks petrol and diesel cracks separately against international benchmarks, so the two levies can move independently. Export-oriented refiners — notably Reliance Industries’ Jamnagar complex and Nayara Energy — watch these revisions closely, since the duties directly affect their export realisations and shipping economics. Every revision resets the maths on whether a cargo earns more abroad or at home, which is exactly the lever the government is pulling.
Will the petrol export duty affect pump prices?
The petrol export duty will not change what motorists pay at fuel stations today. Export duties apply only to fuel shipped abroad; retail petrol and diesel prices in India are set separately and have been largely unchanged for months. On October 16, petrol retailed at Rs 102.12 per litre in Delhi, Rs 113.32 in Maharashtra, Rs 115.29 in Telangana and Rs 117.78 in Andhra Pradesh, with state taxes accounting for most of the variation between states.
What the levy does affect is the incentive structure for refiners. By raising the cost of exporting petrol, the government nudges refiners to prioritise domestic supply — the original intent of the windfall tax regime when it was first designed in 2022. With West Asia tensions keeping crude volatile, the next fortnightly review will be watched closely for whether the levy moves again or holds at Rs 2.5 per litre.