Fuel Price Cut on the Cards? Minister Hardeep Singh Puri Drops Big Hint as Global Crude Softens
The central government may soon slash the retail prices of petrol and diesel in India if international crude oil prices remain consistently low over the next few weeks. Union Petroleum and Natural Gas Minister Hardeep Singh Puri dropped this crucial hint during a press briefing in New Delhi on Thursday.
The Financial Hit and Current Stance of OMCs
According to Minister Puri, state-run Oil Marketing Companies (OMCs) have taken a massive hit due to the recent geopolitical friction between the United States and Iran in the Middle East. Till June 30, OMCs suffered a staggering loss of ₹74,781 crore on the sale of petrol, diesel, and domestic LPG.
Even though international Brent crude rates have cooled down following the resolution of the crisis, Indian fuel rates haven’t dropped immediately. The Minister explained that OMCs are currently absorbing losses from processing high-cost crude oil that was purchased at the peak of the West Asian conflict.
Expanding India’s Refining Capacity
Highlighting the ministry’s long-term infrastructure goals, Puri shared details about a recent capital expenditure review. “We have various advanced-stage projects, including new refineries, which will be commissioned over the next 6 to 12 months. This will boost India’s total refining capacity to an impressive 300 million metric tonnes per annum (MMTPA),” he stated.
Puri also commended the resilience of India’s fuel supply chain, noting that despite intense global supply pressures through March, April, May, and June, the domestic market witnessed zero dry-outs, major shortages, or panic-buying queues.
Peace Deal Restores Supply Chains
The global energy market faced severe disruption earlier this year when the US-Iran conflict led to the brief closure of the critical Strait of Hormuz—a maritime transit point for nearly 20% of the world’s petroleum liquids. India had repeatedly advocated for keeping the strait open to stabilize global economies.
Following a newly signed peace treaty between the US and Iran, international Brent crude prices have steadily slid backward. Responding to the easing supply strains, the central government lifted temporary restrictions on the sale and distribution of fuel effective July 1, signaling a return to normal retail operations across the country.
