When can customers expect petrol/diesel price reduction? Hardeep Puri answers
What's the story
Union Petroleum Minister Hardeep Singh Puri has said that consumers shouldn't expect an immediate reduction in petrol and diesel prices even as global crude oil prices have fallen to around $70 a barrel. He said that any reduction would take two to three months since oil companies are still selling fuel refined from more expensive crude purchased during the peak of the West Asia conflict. "The crude that you buy...today would have been obtained two months ago," Puri said.
Market influence
Potential reduction in fuel prices depends on this factor
Puri clarified that any potential reduction in fuel prices would depend on whether international crude prices remain at current levels for the next two to three months. He said, "If this (international prices) persists for the next two-three months, then that would be a legitimate question." However, he also noted that this scenario is hypothetical and declined to elaborate further.
Price defense
Petrol, diesel prices hiked only marginally in Delhi
Puri defended the government's decision to raise fuel prices, saying that excise duty cuts largely shielded consumers from the impact of the crisis. He pointed out that petrol and diesel prices in Delhi were hiked by only about 5.6% and 6.2%, respectively, between June 2022 and June 2026. This, he said, is in stark contrast to much higher increases seen in several developed and neighboring countries during the same period.
Corporate impact
OMCs bore the burden during the crisis
Puri acknowledged that while consumers were shielded from higher prices, state-run oil marketing companies bore the burden. He said cumulative under-recoveries on petrol, diesel and LPG during Q1 FY2027 amounted to about ₹1.88 lakh crore. However, he clarified that the actual loss incurred by OMCs during this period was around ₹74,781 crore as they continue to recover from losses incurred by selling fuel below cost amid the West Asia crisis.
Crisis management
India navigated Hormuz crisis without any fuel shortages
Puri emphasized that India successfully navigated the 110-day Hormuz crisis without any fuel shortages. He said none of India's nearly 107,000 retail fuel outlets reported a dry out during the period from late February through June. Any reports of shortages were largely fueled by misinformation and panic buying, he added. "We came out of it (crisis) without any closures and dry outs," Puri said.
Future plans
We have energy reserves for at least 76-80 days: Puri
Looking ahead, Puri said the government will focus on expanding India's energy storage capacity. He stressed that this shouldn't just be seen through the prism of underground strategic petroleum reserves (SPRs), as India also has stocks in refineries, ports, terminals and floating cargoes. "If you add what is in the ports, terminals, refineries and strategic petroleum reserves, it is at least 76 to 80 days (worth of supplies)," he said.