NEW DELHI, 7 APRIL

 The government on Monday hiked excise duty on petrol and diesel by Rs 2 per litre each but there will be no change in retail prices as the increase will be adjusted against the price cut that was warranted because of falling international oil prices.

The excise duty on petrol was hiked to Rs 13 per litre and that on diesel to Rs 10 a litre, an official order showed.

The increase in duties will "come into force on the 8th day of April, 2025," it said.

While any change in taxes are normally passed on to consumers, there will be no change in retail selling price of petrol and diesel as the excise hike will be set off against the reduction in retail prices that was warranted from fall in international oil prices.

International oil prices have slumped to their lowest since April 2021 as escalating trade tensions between the United States and China stoked fears of a recession that could cut oil demand.

Brent futures lost USD 2.43, or 3.7 per cent, to USD 63.15 a barrel on Monday while US West Texas Intermediate crude futures were down USD 2.42, or 3.9 per cent, at USD 59.57.

India is 85 per cent dependent on imports to meet its oil needs.

"PSU Oil Marketing Companies have informed that there will be no increase in retail prices of #Petrol and #Diesel, subsequent to the increase effected in Excise Duty Rates today," the oil ministry said in a post on X.

The Modi government during its 11-year rule hiked excise duty whenever international oil prices fell.

The government had raised excise duty on petrol and diesel on nine occasions between November 2014 and January 2016, to take away gains arising from plummeting global oil prices.