Petrol export levy cut to nil, diesel and ATF duties retained: What changes from August 15

In a significant policy adjustment, the Indian government has completely eliminated the export levy on petrol for the upcoming fortnight, effective from August 15. This move, outlined in a Ministry of Finance notification issued on Friday, signifies a shift in strategy concerning the export of petroleum products. While petrol exports will now be exempt from both the Special Additional Excise Duty (SAED) and the Road and Infrastructure Cess (RIC), duties on diesel and aviation turbine fuel (ATF) exports are being maintained.

Specifically, for the period between August 15 and August 31, petrol export levy will be set at zero. Conversely, diesel exports will continue to incur an SAED of Rs 24 per litre, and ATF exports will attract an SAED of Rs 19.5 per litre. These revised rates are part of the government’s established practice of conducting a fortnightly review of export levies on various petroleum products, a mechanism designed to adapt to dynamic global energy market conditions. This particular adjustment follows a previous revision implemented on August 3.

The imposition of these export levies was initially introduced in March 2026, a measure prompted by the West Asia crisis. The overarching goal behind these duties was to ensure a sufficient domestic supply of petrol, diesel, and ATF by making their overseas sale less financially attractive for exporters. The rates are meticulously reviewed every two weeks, with adjustments based on the average international prices of crude oil, petrol, diesel, and ATF observed since the preceding review. This policy framework was conceived against a backdrop of considerable instability in global energy markets, serving as a tool to discourage exports of crucial petroleum commodities and, in turn, bolster domestic availability.

It is crucial to note that this recent notification pertains exclusively to petroleum products destined for export. The existing excise duty rates on petrol and diesel intended for domestic consumption remain unchanged, as clarified by the government. Consequently, for the specified August 15-31 fortnight, while petrol exports will benefit from a complete waiver of the levy, diesel and ATF exports will continue to bear their respective duties of Rs 24 per litre and Rs 19.5 per litre. This nuanced approach reflects the government’s ongoing effort to balance export revenue with domestic energy security.