Windfall tax revised from September 1: Export duty on petrol from 0 to ₹1.5/litre, on diesel ₹1; Reduction in ATF fee by ₹ 0.5 | Today’s news
The central government has hiked a surprise export tax on petrol and diesel while marginally reducing the aviation turbine fuel (ATF) levy, with the revised rates coming into effect from January 1.
The finance ministry announced the revised rates in a notification on Tuesday.
What changed in the last revision?
Special Additional Excise Duty (SAED) on diesel exports along with road and infrastructure cess increased by ₹1 per liter, from ₹24 to ₹25 per liter.
SAED for gasoline exports was increased by ₹1.50 per liter, from zero to ₹1.50 per liter.
SAED on ATF exports was reduced by ₹0.50 per liter, from ₹from 19:50 to ₹19 per liter.
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The existing duty rates on petrol and diesel charged for domestic consumption remain unchanged.
The government has been revising the export tax every fortnight since the diesel and ATF tariffs were imposed on March 27 amid escalating tensions in West Asia. A similar levy was imposed on petrol exports from 16 May.
The windfall tax was introduced to discourage exporters from taking advantage of higher world oil prices and to promote adequate domestic availability of petroleum products during the crisis in West Asia.
Oil prices rise more than 2% as US-Iran tensions revive fears of supply disruptions
Oil prices rose more than 2% on Tuesday as renewed hostilities between the United States and Iran in the Middle East raised concerns about a possible disruption to oil supplies from the oil-producing region.
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Brent crude futures were up $2.17, or 2.4%, at $92.66 a barrel by 1302 GMT. U.S. West Texas Intermediate (WTI) crude also gained $2.48, or 2.89%, to $88.24 a barrel.
At these levels, both benchmarks pared most of the losses recorded in the previous week following renewed escalation of the Middle East conflict.
The latest rise in oil prices came after US President Donald Trump warned on Monday that Washington could take further strikes against Iran. The warning followed the first direct exchange of attacks between the two countries since late July, further escalating tensions in a conflict that has recently escalated into an economic confrontation.
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“The US-Iran missile exchanges provide confirmation to those who believe that while this is not an ‘eternal war,’ this conflict will run and run,” PVM analyst John Evans said, according to Reuters.
Iranian President Masoud Pezeshkian said on Tuesday that Tehran would respond immediately if the US returned to its commitments under the interim peace deal signed in June.
Meanwhile, Qatar and Oman’s mediation efforts to reach an agreement to reopen the Strait of Hormuz have yet to produce a breakthrough. The strategically important waterway handled about a fifth of the world’s oil and liquefied natural gas (LNG) supplies before the war broke out in late February.
Tensions around the strait also escalated on Monday when two supertankers carrying Saudi oil were hit by unidentified projectiles within minutes of each other while passing through the waterway.
Saxo Bank analyst Ole Hansen said: “Fresh hostilities between the US and Iran have raised concerns about long-term disruptions to energy flows through the Strait of Hormuz,” adding that the absence of subsequent purchases suggested the market expected supply disruptions to remain limited to levels already seen.
Two Saudi Arabian oil supertankers were hit by unidentified projectiles within minutes of each other while sailing through the Strait of Hormuz on Monday.
(With input from agencies)
