India Doubles Export Levies on Diesel and Jet Fuel

The Finance Ministry set the new diesel export duty at 15.50 rupees per liter, a sharp increase from the previous 8.5 rupees. Aviation fuel levies climbed to 14.5 rupees, up from 7.5 rupees. Conversely, gasoline exports saw a reduction, with the duty dropping to 2.5 rupees from 4 rupees. These adjustments reflect a routine review process designed to balance domestic supply against volatile international price conditions.

While these hikes are significant, they remain well below the peak rates observed earlier in the conflict, when duties were three to four times higher. Analysts warn that the new pricing could throttle Indian exports, further straining a global market already grappling with low inventories. Ole Hansen of Saxo Bank notes that the primary stress in current energy markets lies in refined products rather than crude oil. With Russian refining capacity hampered by drone strikes and peak seasonal demand rising, the market for diesel and jet fuel continues to command exceptionally strong premiums.