India Raises Fuel Prices Twice Amid Middle East Tensions
India has increased retail fuel prices for the second time within a week as the country grapples with surging crude costs amid ongoing conflict in the Middle East. The latest price hike came as state fuel traders sought to protect their margins from the impact of escalating oil prices and disrupted supply chains.
The most recent adjustment raised fuel prices by approximately $0.0093 per litre, following a significantly larger increase last week—the first in nearly four years. This cumulative rise reflects the challenges faced by India, the world’s third-largest crude oil importer, as the conflict has severely constrained oil imports passing through the vital Strait of Hormuz.
Wholesale fuel prices earlier in the month had already demonstrated sharp increases, with gasoline prices up by 32.4% and diesel prices increasing by 25.19% in April compared to the previous month. These steep rises contrast with more modest monthly gains recorded in March, suggesting the growing pressure on India’s fuel market as the geopolitical crisis endures.
Industries and consumers alike face repercussions from the tightening fuel supply. The limited availability of liquefied petroleum gas (LPG) is creating acute shortages, highlighting vulnerabilities within India’s energy security framework. Concurrently, the country’s wholesale inflation surged to 8.3% in April, more than doubling from its 3.88% level in March. Fuel cost inflation has been a major contributing factor to this acceleration.
The Indian government is proactively responding to the crisis by urging citizens to reduce travel, adopt public transportation, and engage in carpooling to conserve energy. Currently, India maintains a crude oil stockpile equivalent to 69 days of supply and a 45-day reserve of LPG, according to statements from the country’s oil minister.
In a related development, the United States has renewed a sanction waiver allowing India to continue importing Russian crude oil despite global sanctions, recognizing the strained supply situation brought about by the regional conflict.
The extended period of supply instability is expected to continue impacting India’s energy market and overall economy. The government and energy companies remain vigilant, monitoring global developments and adjusting prices as necessary to balance supply constraints with domestic demand.