Lok Sabha Question No. 3106 (UNSTARRED), answered on 2025-12-18
Subject: Impact of Long-Standing Stability in Petrol and Diesel Prices
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Shri Tariq Anwar

## LOK SABHA UNSTARRED QUESTION NO. 3106 TO BE ANSWERED ON 18 DECEMBER, 2025

## Impact of Long-Standing Stability in Petrol and Diesel Prices

† 3106. SHRI TARIQ ANWAR:

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũी

Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

(a)  the  impact  of  maintaining  long-term  stability  in  petrol  and  diesel  prices  on  the  financial health of Public Sector Oil Marketing Companies (OMCs);

(b)  the  steps  being  taken  by  the  Government  to  meet  the  increasing  demand  for  natural  gas (CNG/PNG) and to reduce import dependence; and

(c) the plan to attract private investment for the development of alternative energy sources such as green hydrogen?

## ANSWER

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũालय मŐ राǛ मंũी ( ŵी सुरे श गोपी )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI SURESH GOPI)

(a) to (c): Pricing of petrol and diesel in the country is market-determined and OMCs take appropriate decision on pricing of petrol and diesel. However, the Government remains sensitive to  the  impact  of  global  oil  price  fluctuations.  Calibrated  interventions  have  been  undertaken  such as reductions in central excise duties. For instance, Government reduced the Central Excise duty by a total of Rs. 13/litre and Rs. 16/litre on petrol and diesel respectively in two tranches in November  2021  and  May  2022,  which  was  fully  passed  on  to  consumers.  Some  State Governments also reduced state VAT rates to provide relief to citizens. In March, 2024, OMCs reduced the retail prices of petrol and diesel by Rs. 2 per litre each. In April 2025, excise duty on Petrol and Diesel was increased by Rs. 2 per litre each but this was not passed on to consumers.

PSU  OMCs  recently  carried  out  an  intra-state  freight  rationalisation.  This  has  benefitted consumers located at remote areas, far from Petroleum Oil & Lubricants (POL) Depots in the form of reduced Petrol and Diesel prices in remote parts within the states. This initiative has also reduced  the  difference  between  the  maximum  and  minimum  retail  prices  of  Petrol  or  Diesel within a state.

Government also took several other steps to insulate common citizens from high international prices, which included diversifying the crude import basket, invoking the provisions of Universal Service Obligation to ensure availability of petrol & diesel in domestic market, increasing the blending of ethanol in petrol, etc.

Government is committed towards security, affordability and accessibility of energy for every citizen. To achieve these objectives Government is promoting usage of alternate fuels like CNG, LNG, Hydrogen, biofuels including ethanol, electric vehicles, etc.

Government notified the National Policy on Biofuels - 2018 which laid out indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel by 2030 in the country.

Subsequently, Government advanced the target of 20% blending of ethanol in petrol from 2030 to 2025-26.  During the ongoing Ethanol Supply Year (ESY) 2024-25, Public Sector OMCs have achieved  the  average  blending  percentage  of  19.24%.  During  the  month  of  October,  2025, Ethanol blending of 19.97% has been achieved.

To  promote  the  use  of  biofuels,  various  programmes  such  as  Ethanol  Blended  Petrol  (EBP) Programme,  wherein  Oil  Marketing  Companies  (OMCs)  sell  petrol  blended  with  ethanol, Biodiesel blending programme wherein biodiesel is blended with diesel, Sustainable Alternative towards Affordable Transportation (SATAT) initiative wherein Compressed Bio Gas (CBG) is marketed along with Compressed Natural Gas (CNG) have been taken up.

For Biofuel production across the country including rural India, the Government has taken steps on pricing, incentives, opened alternate route for ethanol production, notified Pradhan Mantri JIVAN Yojana for setting up second generation ethanol bio-refineries based on agri residues for ethanol  production,  SATAT  initiative  for  production  of  CBG  and  bio-manure  from  various waste / biomass sources, notified interest subvention scheme for enhancement and expansion of ethanol distillation capacity etc.

Government has been taking various steps to boost domestic oil and gas production which, interalia, include:

- i. Policy under PSC regime for early monetization of hydrocarbon discoveries, 2014.
- ii. Discovered Small Field Policy, 2015.
- iii. Hydrocarbon Exploration and Licensing Policy (HELP), 2016.
- iv. Policy for Extension of PSCs, 2016 and 2017.
- v. Policy for early monetization of Coal Bed Methane, 2017.
- vi. Setting up of National Data Repository, 2017.
- vii. Appraisal of Un-appraised areas in Sedimentary Basins under National Seismic Programme, 2017.
- viii. Policy framework for extension of PSCs for Discovered Fields and Exploration Blocks under Pre-New Exploration Licensing Policy (Pre-NELP), 2016 and 2017.
- ix. Policy to Promote and Incentivize Enhanced Recovery Methods for Oil and Gas, 2018.
- x. Policy  Framework  for  exploration  and  exploitation  of  Unconventional  Hydrocarbons under  Existing Production  Sharing  Contracts  (PSCs),  Coal  Bed  Methane  (CBM) Contracts and Nomination Fields, 2018.
- xi. Natural Gas Marketing Reforms, 2020.
- xii. Lower  Royalty  Rates, Zero Revenue  Share  (till Windfall Gain)  and no drilling commitment  in  Phase-I  in  OALP  Blocks  under  Category  II  and  III  basins  to  attract bidders.
- xiii. Release of about 1 Million Sq. Km. (SKM) 'No-Go' area in offshore which were blocked for exploration for decades.
- xiv. Government is also spending about Rs.7500 Cr. for acquisition of seismic data in onland and  offshore  areas  and  drilling  of  stratigraphic  wells  to  make  quality  data  of  Indian Sedimentary  Basins  available  to  bidders.  Government  has  approved  acquisition  of additional  2D  Seismic  data  of  20,000  LKM  in  onland  and  30,000  LKM  in  offshore beyond Exclusive Economic Zone (EEZ) of India.

National  Green  Hydrogen  Mission  (NGHM)  has  been  launched  by  Ministry  of  New  and Renewable Energy (MNRE), Government of India, with an objective to make India a global hub of production, usage and export of green hydrogen and its derivatives.

NGHM targets Green Hydrogen production  capacity  of  5  Million  Metric  Tonnes  (MMT)  per annum by 2030.

Strategic  Interventions  for  Green  Hydrogen  Transition  (SIGHT)  is  a  key  component  of  the Mission which provides financial incentives for production of green hydrogen and electrolyser manufacturing.

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