The government on Monday stated that domestic jet fuel prices continue to track international markets, with an under-recovery of approximately Rs 30 per litre. Sujata Sharma, Joint Secretary in the Ministry of Petroleum and Natural Gas, explained that this under-recovery is variable and based on international price fluctuations.
LPG Demand Management
Regarding LPG, Sharma confirmed that consumption has been moderated through administrative measures. The government has managed demand by adjusting booking timelines and restraining commercial supplies, leading to a slight reduction in consumption.
Fuel Sales Surge in May
These comments come amid a spike in retail fuel demand. In May 2026, petrol and diesel sales increased by more than 30% in many districts. To ease the burden, the government reduced the export levy on petrol from Rs 3 to Rs 1.5 per litre, on diesel from Rs 16.50 to Rs 13.50 per litre, and on ATF from Rs 16 to Rs 9.5 per litre, effective May 31, 2026. Earlier, excise duties on petrol and diesel were cut by Rs 10 per litre.
Officials assured that despite crowding at some pumps, adequate stocks of petrol and diesel are available nationwide. The surge in sales has shifted market share: private oil marketing companies saw a 38% decline in sales, and bulk sales of PSU OMCs fell by 29%, as volumes moved to PSU retail outlets.
Measures Against Diversion
To curb diversion, states and union territories have been asked to form special squads to take action against malpractice by bulk consumers and hoarders. This includes black marketing, unauthorized stocking, and diversion of petroleum products under the Essential Commodities Act. Industry associations have been advised to ensure members purchase diesel only from authorized channels.
