New Delhi, July 2: Consumers hoping for a reduction in petrol and diesel prices are unlikely to receive immediate relief, with the Union Petroleum and Natural Gas Ministry stating that current market conditions do not justify a cut in retail fuel prices. The government said state-run oil marketing companies (OMCs) are still recovering substantial financial losses and continue to hold inventories purchased at significantly higher international crude oil prices.
Addressing the issue on Thursday, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said the question of reducing petrol and diesel prices is not justified at this stage. He maintained that retail fuel prices in India have remained largely stable despite sharp fluctuations in global crude oil markets over the past several years.
The minister stated that petrol prices have increased by only 5.58 per cent during the last four years, while diesel prices have risen by 6.23 per cent over the same period. According to him, these figures reflect the government’s efforts to shield consumers from volatility in international energy markets.
Puri said state-owned oil marketing companies are continuing to recover cumulative under-recoveries amounting to nearly ₹2.18 lakh crore. He also noted that these companies continue to maintain inventories that were procured when global crude oil prices were substantially higher than current levels, making an immediate reduction in retail fuel prices financially impractical.
The minister asserted that these financial realities remain a key factor behind the government’s current position on fuel pricing. He said the existing circumstances do not warrant a reduction in petrol and diesel prices.
Highlighting India’s handling of recent global energy market disruptions, Puri said the country successfully managed the impact of international developments without affecting domestic fuel availability. Referring to recent tensions around the Strait of Hormuz, he said India maintained uninterrupted fuel supplies throughout the period despite concerns over global crude oil movement.
According to the minister, none of the country’s approximately 1.07 lakh retail fuel outlets reported any shortage or disruption during the period of heightened geopolitical uncertainty. He credited the government’s energy management strategy with absorbing much of the pressure created by fluctuations in international crude prices and ensuring uninterrupted distribution across the country.
Puri also outlined the government’s long-term strategy to strengthen India’s energy infrastructure and improve refining capacity. He said the country’s refining capacity is projected to reach 309.5 million metric tonnes per annum (MMTPA) by 2030.
He further stated that multiple refinery expansion projects and greenfield refinery developments are currently under implementation. Some of these projects are expected to be completed within the next two years and are aimed at enhancing India’s refining capabilities and strengthening long-term energy security.
The government’s latest position indicates that while international crude prices continue to influence domestic fuel economics, the priority remains maintaining supply stability and enabling state-run oil companies to recover accumulated losses before considering any reduction in retail fuel prices.
