India Raises Fuel Prices for First Time in Four Years Amid Crude Supply Pressure

India has increased retail prices of petrol and diesel for the first time in four years as rising global crude oil costs and supply disruptions continue putting pressure on the country’s energy sector.

State-owned refiners raised fuel prices by around $0.031 per litre, marking an increase of more than 3%. The move comes after sustained losses faced by refiners due to sharply higher crude oil prices in the international market.

Despite the growing pressure, the Indian government had delayed fuel price hikes for an extended period due to the sensitivity of domestic consumers to rising fuel costs.

Reports indicate that wholesale fuel prices surged significantly in April, with petrol prices rising more than 32% while diesel prices climbed over 25% compared to the previous month. This represented a sharp acceleration from the relatively moderate increases recorded in March.

The recent surge in energy costs has been largely linked to the ongoing Middle East conflict, which severely disrupted crude oil flows passing through the Strait of Hormuz — a route that previously handled more than 40% of India’s crude imports.

As one of Asia’s fastest-growing economies and the world’s third-largest crude oil importer, India has faced mounting economic pressure from rising import bills, foreign investor outflows, and a weakening currency.

The Indian rupee recently dropped to record low levels against the US dollar, while wholesale inflation accelerated sharply in April. Government data showed wholesale inflation rising to 8.3% year-on-year compared to 3.88% in March.

Although India continues to maintain strategic crude reserves, authorities have increasingly encouraged fuel conservation measures in recent weeks.

Earlier this week, India also requested the United States to extend sanction waivers allowing imports of Russian crude oil, as replacing lost Middle Eastern supplies remains difficult under current market conditions.

The US had previously extended the waiver until May 16, but uncertainty surrounding the Strait of Hormuz situation continues creating concerns over future supply availability.

Meanwhile, India’s imports of Russian crude oil have surged significantly since the conflict began. Market data showed imports more than doubled between February and March and recently climbed to around 2.3 million barrels per day — the highest level ever recorded for Indian purchases of Russian crude.

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