Indian oil firms losing ₹20 on diesel per liter
What's the story
India's petrol price benchmark has hit a 50-month high of $133.05 per barrel this month, according to industry officials and official data. The spike is putting pressure on state-run oil marketing companies (OMCs) as geopolitical tensions could push international oil prices even higher. The average daily benchmark price for petrol from September 1-18 was 20% higher than August's average of $110.87 per barrel.
Retail impact
Petrol prices surpass previous peak
The current petrol price has surpassed the previous peak of $129.63 recorded in May.
This has already started affecting fuel retailers, with OMCs losing nearly ₹5 per liter on petrol and ₹20 on diesel.
Some private oil companies have even started curbing bulk diesel sales due to these losses.
The average daily benchmark price for diesel has also hit a four-month high of $167.08 per barrel but is still lower than April 2026's peak during the recent energy crisis.
Price forecast
Potential rise in international crude prices
The immediate concern for fuel retailers is a potential rise in international crude prices if geopolitical tensions escalate or India and China are pressured to cut Russian oil imports.
"Public sector OMCs may absorb under-recoveries in the current quarter (July-September), but a price hike would be imminent if countries like China and India succumb to US pressure against buying Russian crude," an industry expert told Hindustan Times.
Supply issues
Disruption of energy flows through Strait of Hormuz
Geopolitical tensions have also raised supply concerns, especially with energy flows through the Strait of Hormuz being disrupted.
Saudi Arabian supplies have become less predictable due to attacks on oil infrastructure and export supply lines.
Further disruption to shipping through the Bab al-Mandeb Strait, drone attacks on Saudi Arabia's East-West pipeline, and new US measures targeting countries buying Russian crude could also affect international oil markets.