NEW DELHI, Aug 15: The Centre has reduced export duties on petrol, diesel and aviation turbine fuel (ATF) with effect from August 15, according to a government notification, lowering the levy on overseas shipments of the three petroleum products.
The petrol export duty has been reduced to nil from Rs 3.5 per litre. The total levy on diesel exports has been lowered to Rs 24 per litre from Rs 25.5, while the duty on ATF has been cut to Rs 19.5 per litre from Rs 22.
The revised rates apply to petroleum products cleared for export. The Finance Ministry has clarified previously that changes in export levies do not affect excise duty rates applicable to petrol and diesel supplied for domestic consumption.
Latest Revision Partly Reverses August 3 Hike
The move comes less than two weeks after the government raised duties on all three petroleum products as part of its previous review.
On August 3, the levy on petrol exports was increased from Rs 2.5 to Rs 3.5 per litre. The combined duty on diesel was raised sharply from Rs 15.5 to Rs 25.5 per litre, while the ATF levy went up from Rs 14.5 to Rs 22 per litre.
The Rs 25.5-per-litre diesel levy consisted of the Special Additional Excise Duty (SAED) and Road and Infrastructure Cess (RIC), rather than SAED alone.
The latest notification therefore represents a partial reversal of the increases announced earlier this month, particularly for diesel and ATF exporters.
Export Levies Reviewed Every Fortnight
The government reviews duties on petroleum exports every two weeks. The rates are determined after assessing the average international prices of crude oil, petrol, diesel and ATF recorded since the preceding review.
Depending on the product and the rates notified for a particular period, the levy can be imposed through SAED, RIC or a combination of both.
The system allows the Centre to adjust export duties in response to changes in international energy markets while monitoring the domestic supply situation.
Export Duty Regime Introduced in March
The current framework was introduced on March 27, 2026, when the government imposed a Rs 21.5-per-litre levy on diesel exports and Rs 29.5 per litre on ATF exports. Petrol shipments were exempt from the duty at that stage.
The government had said international crude oil and refined fuel prices had increased amid the West Asia conflict, making exports more attractive for domestic refiners.
According to the Centre, the duties were intended to encourage refiners to prioritise supplies of diesel and ATF for the domestic market rather than diverting larger volumes to overseas destinations.
Petrol was subsequently brought under the framework on May 16 with an export levy of Rs 3 per litre. During the same review, the duty on diesel was reduced from Rs 23 to Rs 16.5 per litre, while the ATF levy was lowered from Rs 33 to Rs 16 per litre.
India Had Withdrawn Earlier Windfall Tax Regime
India originally introduced a windfall tax in July 2022 after international crude prices surged. The mechanism covered domestically produced crude oil and exports of refined petroleum products, including petrol, diesel and ATF.
The earlier regime was withdrawn in December 2024, when the government abolished the levy on domestic crude production and removed export duties on refined fuels.
However, export levies on diesel and ATF were brought back in March 2026 following a renewed increase in global crude and refined petroleum prices linked to the West Asia conflict.
Petrol exports were subsequently included in the revised duty structure in May.
The August 15 notification marks the latest adjustment under the Centre’s fortnightly mechanism, with the government continuing to recalibrate export levies in line with international petroleum prices and domestic supply considerations.