Fuel Prices Rise Again Across India Amid Global Oil Crisis and Tensions
Petrol and diesel rates witness fourth hike since May 15 as soaring crude prices, Strait of Hormuz disruptions and West Asia tensions increase pressure on consumers and inflation.
Fuel prices across India surged again on Monday as state-run oil marketing companies implemented the fourth hike in less than two weeks amid escalating geopolitical tensions and rising global crude oil prices. The latest revision, effective from May 25, has increased petrol prices by an average of Rs 2.61 per litre and diesel by Rs 2.71 per litre.
The fresh hike by Indian Oil Corporation, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited comes after retail fuel price revisions resumed on May 15 following a prolonged freeze. In Delhi, petrol prices have risen to Rs 102.12 per litre from Rs 99.51, while diesel now costs Rs 95.20 per litre compared to Rs 92.49 earlier. Mumbai petrol prices are nearing Rs 111 per litre, while Kolkata has also witnessed steep increases.
With the latest revision, cumulative fuel price hikes since May 15 have crossed Rs 7 per litre for both petrol and diesel in major cities. Earlier increases included an initial hike of around Rs 3 per litre on May 15, followed by smaller revisions on May 19 and May 23.
The sharp rise in fuel prices has been linked to soaring international crude oil prices triggered by the ongoing tensions involving the United States, Israel and Iran, along with disruptions in the strategically important Strait of Hormuz. The region handles nearly 20 percent of global oil and LNG shipments, and concerns over supply disruptions have pushed Brent crude prices close to or above 100 dollars per barrel in recent weeks. India, which imports nearly 85 to 88 percent of its crude oil requirements, remains highly vulnerable to such global shocks.
Oil marketing companies reportedly faced massive under-recoveries during the prolonged price freeze, with losses estimated at nearly Rs 1,000 crore per day at peak levels. Rising import costs, higher freight expenses and a weakening rupee further intensified pressure on refiners.
Economists have warned that the continued fuel price hikes could increase inflationary pressure across sectors, particularly transportation, logistics and food prices. Analysts estimate the latest increases may add 10 to 25 basis points to India’s Consumer Price Index inflation. Middle-class households and daily commuters are likely to feel the biggest impact as fuel expenses continue to rise.
Experts believe further gradual hikes may remain possible if global crude oil prices stay elevated. However, the government is currently opting for phased price revisions instead of a one-time sharp increase to reduce the burden on consumers. Fuel prices continue to be revised daily at 6 AM, with rates varying across states depending on local taxes and dealer commissions.
