India Tweaks Fuel Policy: Export Duty Cut, Jet Fuel Prices for International Airlines Rise 5%

In a significant recalibration of fuel policy amid volatile global energy markets, the government on Friday moved in two contrasting directions, reducing export duties on petroleum products while allowing an increase in jet fuel prices for international airlines.

The finance ministry announced a sharp cut in the windfall gains tax on diesel exports , bringing it down to Rs 23 per litre from Rs 55.5 , while also reducing the levy on aviation turbine fuel (ATF) exports to Rs 33 per litre from Rs 42 . The road and infrastructure cess on diesel exports has been made nil for a fortnight beginning May 1. Export duty on petrol continues to remain unchanged at zero.

Officials clarified that there is no change in excise duty on petrol and diesel for domestic consumption , ensuring that local retail fuel prices remain stable despite global fluctuations.

The move comes after multiple revisions in recent months, reflecting shifting crude oil dynamics and geopolitical tensions, particularly in West Asia, which have kept global energy markets on edge.

At the same time, aviation fuel prices for international airlines have been increased by 5 per cent , marking the second consecutive monthly hike . In Delhi, ATF for foreign carriers now stands at USD 1511.86 per kilolitre , an increase of about USD 76.55 per kilolitre , according to state owned oil companies.

This follows a steep adjustment earlier in April when aviation fuel prices were revised upward in response to rising global crude costs. While international airlines are facing higher fuel expenses, domestic carriers continue to be shielded , with ATF prices for them left unchanged this month.

Industry sources said jet fuel pricing for airlines remains linked to international benchmarks under a deregulated structure, but recent global disruptions have prompted a more calibrated pricing approach to avoid sudden shocks.

The twin move highlights a balancing act in energy policy: easing pressure on exporters to ensure competitiveness, while aligning aviation fuel prices with global oil trends amid ongoing geopolitical uncertainty.

With crude oil markets still sensitive to supply risks and West Asia tensions, further adjustments in fuel pricing are expected to remain under close watch in the coming weeks.