- Retail fuel prices stable; government absorbed higher crude costs.
- Current fuel from older, expensive crude; OMCs face losses.
- India maintained energy security; poised as major refining hub.
Union Petroleum and Natural Gas Minister Hardeep Singh Puri on Thursday said that there would be no increase in retail fuel prices, asserting that the government’s fiscal measures have absorbed the impact of higher global crude oil prices.
Addressing questions on when petrol and diesel prices could be reduced further, Puri explained that retail fuel prices do not immediately reflect changes in international crude prices because of the time taken in procurement, transportation and refining.
“It is the budget and our fiscal system which absorbed that increase. So, there will be no increase,” the minister said.
He said the crude oil used to produce the petrol and diesel currently being sold at fuel stations was purchased nearly two months ago, when international prices were higher.
#WATCH | Delhi | Union Minister for Petroleum and Natural Gas Hardeep Singh Puri explains the dynamics behind fuel pricing and whether the prices will go down further. pic.twitter.com/NjgtRjkTgA
— ANI (@ANI) July 2, 2026
“The crude represented in the petrol and diesel you buy today would have been procured around two months ago. If crude prices fall to around $70 a barrel today, that cheaper crude will reach India only after several weeks,” he said.
Puri said the pricing mechanism also factors in insurance and freight costs, refining margins, central excise duty, state VAT and dealers’ commissions before fuel reaches consumers.
Responding to expectations of a price cut, the minister said the government would continue to monitor global crude prices over the coming weeks.
“If prices remain at these levels, we will review the situation every 10 to 15 days,” he said.
The minister also disclosed that public sector Oil Marketing Companies (OMCs) are facing significant under-recoveries despite stable retail fuel prices.
According to Puri, the estimated under-recoveries for the April-June quarter of FY2026 stood at ₹19,905 crore on petrol, ₹1.44 lakh crore on diesel and ₹24,148 crore on LPG.
He said these figures reflected the financial burden borne by OMCs as consumers were shielded from the full impact of elevated global crude oil prices.
India Maintained Adequate Stocks Of Fuel: Puri
He also said India remained energy secure even during the most challenging global disruptions, crediting the government’s diversification of crude oil import sources and robust refining capacity for ensuring uninterrupted fuel supplies.
Speaking at an event, Puri said the country maintained adequate stocks of crude oil, diesel and LPG despite global supply uncertainties.
“Even at the most difficult point, we were sufficiently stocked with supplies of crude oil, diesel and LPG. It was because we had diversified our sources of supply. Even in the most difficult time, we had more than 60 days of crude, diesel and natural gas supplies,” he said.
‘By 2030, India Will Emerge As World’s Major Refining Hubs’
Highlighting India’s growing role in the global energy landscape, the minister said the country is poised to emerge as one of the world’s major refining hubs by the end of the decade.
“We can see that by 2030, there are likely to be three to four major refining hubs in the world, and India is certainly emerging as one. Global trade in hydrocarbons will be determined and largely influenced by countries with refining capacities,” Puri said.
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‘India’s Energy Supply Remained Resilient’
He also defended the government’s fuel pricing strategy, saying consumers were shielded from the impact of soaring global crude oil prices.
“From 2022 to 2026, the increase in prices of petrol has been 5.58 per cent and 6.23 per cent for diesel. There has been no increase in the price of fuel for consumers. Our fiscal system absorbed the hike in crude oil prices,” he said.
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Puri said India’s energy supply chain remained resilient throughout the period of global volatility, with no significant disruptions in fuel availability.
“Why did we do well and come out of the crisis without any closures and dry-outs? During March, April, May and June, there were no dry-outs. By and large, there was no disruption, shortage or queues,” he added.
Before You Go
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