The government has increased export duties on diesel and aviation turbine fuel (ATF) while removing the levy on petrol exports, with the revised rates coming into effect from October 31.
Highlights
- Government hikes windfall tax on diesel and ATF exports.
- Diesel export duty increased from ₹8.5 to ₹11.5 per litre.
- ATF export duty raised from ₹10.5 to ₹11 per litre.
- Petrol export duty reduced from ₹2.5 per litre to zero.
- Revised tax rates effective from October 31.
- Government aims to improve domestic fuel availability amid West Asia tensions.
New Delhi, November 1, 2026: The central government has increased the windfall tax on exports of diesel and aviation turbine fuel (ATF), while removing the export duty on petrol. The revised tax rates came into effect on October 31, according to a notification issued by the Finance Ministry.
The decision comes amid escalating geopolitical tensions in West Asia and concerns over global crude oil supplies. The government aims to improve domestic fuel availability and prevent exporters from taking undue advantage of international price differences.
Diesel Export Duty Increased to ₹11.5 Per Litre
Under the revised structure, the export duty on diesel has been increased from ₹8.5 per litre to ₹11.5 per litre, marking a rise of ₹3 per litre.
The increase is expected to make diesel exports less attractive and encourage greater availability of the fuel in the domestic market.
Meanwhile, the government has also raised the export duty on aviation turbine fuel (ATF) from ₹10.5 per litre to ₹11 per litre.
Petrol Export Duty Reduced to Zero
In contrast, the government has completely removed the export duty on petrol, reducing it from ₹2.5 per litre to zero.
The move provides relief to petrol exporters and could support overseas shipments of the fuel.
The revised rates reflect the government’s approach to balancing domestic fuel requirements with export opportunities amid volatility in international energy markets.
West Asia Tensions Drive Policy Changes
According to the Finance Ministry, the changes come against the backdrop of rising tensions in West Asia, a region critical to global crude oil production and transportation.
The government said the decision is intended to ensure adequate domestic fuel availability while preventing exporters from benefiting excessively from international price differences.
The ministry also clarified that there is no change in the existing duty rates on petrol and diesel cleared for domestic consumption.
Impact on Oil Exporters
The higher duties on diesel and ATF could increase the tax burden on refiners exporting these fuels, potentially affecting their export margins.
However, the removal of petrol export duty could provide some relief to companies engaged in overseas petrol sales.
The government’s latest decision highlights its efforts to safeguard domestic energy supplies while responding to developments in global oil markets.
