Amidst renewed attacks between the US and Iran global crude oil prices have surged forcing the centre to revise the tariffs. The centre raised windfall taxes on exports of diesel and aviation turbine fuel, while cutting the duty on petrol.
As per the notification, the export duty on diesel has been increased to Rs15.5 per litre from Rs8.5 per litre. At the same time, the levy on aviation turbine fuel has been raised to Rs 14.5 per litre from Rs 7.5 per litre. Additionally, the export duty on petrol has been reduced to Rs2.5 per litre from Rs.4 per litre. The revised rates will come into effect from July 16.
The lastest revision reflected the surge in Brent crude that traded above $85 a barrel on Thursday. In contrast, US West Texas Intermediate crude hovered around $80 a barrel after extending gains for a fourth straight session.
The Strait of Hormuz that is a crucial water way for global supply remains the key reason for the war. Nearly a fifth of global oil supplies passes through the chokepoint. Any disruption to traffic through the waterway can quickly push crude prices higher.
A windfall tax is an extra levy charged when companies earn unusually high profits due to a sudden rise in commodity prices rather than better business performance.
India, mainly imposes taxes on exports of petroleum products when global crude prices and refining margins rise significantly, and they are reviewed every two weeks in line with movements in international oil prices.