Assembly Election 2026: Will Petrol, Diesel Prices Rise After Polls? What Petroleum Ministry Said

As Assembly elections continue across key states, concerns are emerging over a possible rise in petrol and diesel prices once polling concludes on April 29. A report by Kotak Institutional Equities has suggested that fuel prices in India could see a sharp increase if global crude oil prices remain elevated, but the government has firmly denied any such move.

At the centre of the debate is the widening gap between international crude oil prices and domestic retail fuel rates. With crude hovering close to $120 per barrel, the cost of importing, refining and distributing fuel has risen significantly. Despite this, retail prices in India have remained largely unchanged, raising questions about how long this gap can be sustained.

What The Report Says

Kotak Institutional Equities estimates that petrol and diesel prices could rise by ₹25 to ₹28 per litre if crude continues to trade at current levels. The projection is based on the higher input costs faced by oil marketing companies, which are currently not being fully passed on to consumers.

However, the report also notes that any increase is unlikely to be immediate or abrupt. Instead, a phased revision over weeks or months is seen as more likely, allowing policymakers to balance inflation concerns with the financial strain on oil companies.

Petrol diesel price hike: current and projected rates by city

Kotak Institutional Equities based the estimated petrol diesel price hike on crude trading near $120 per barrel. At that level, existing retail prices cannot recover full costs. If the suggested rise happens, projected numbers in key cities would look like the following, assuming flat tax structures remain.

Government's Response

Responding to the speculation, the Ministry of Petroleum and Natural Gas has dismissed the reports, stating that there is no proposal under consideration to increase fuel prices. The ministry said such claims are misleading and aimed at creating unnecessary concern among citizens.

In its clarification, the ministry highlighted that India is among the few countries where petrol and diesel prices have not been raised in the past four years despite global volatility. It added that both the central government and public sector oil companies have taken consistent steps to shield consumers from sharp international price movements.

Who Is Bearing The Cost

While prices at the pump have remained stable, the burden appears to be shifting to oil marketing companies. Analysts point out that at crude levels of around $95 per barrel, these companies were already absorbing significant losses.

According to Arun Kailasan, Research Analyst at Geojit Investments Limited, oil companies were facing losses of nearly ₹1,600 crore per day at those levels. With crude now moving higher, these losses are likely to increase further, making the current pricing strategy difficult to sustain in the long term without either a price revision or government intervention.

What It Means For Consumers

For consumers, any potential increase would be substantial. Petrol prices in major cities currently range between ₹94 and ₹96 per litre. A hike of ₹25 to ₹28 could push prices close to ₹120 per litre, marking an unprecedented level in India.

The impact would extend beyond fuel costs. Higher petrol and diesel prices typically lead to increased transportation expenses, higher delivery charges and broader inflationary pressures across sectors such as food, logistics and manufacturing. This, in turn, affects household budgets and overall consumption.

For now, fuel prices remain unchanged, with the government maintaining that there is no immediate plan to revise rates. However, with global crude prices staying elevated and oil companies under pressure, the situation remains closely watched.

Whether prices remain stable or see a gradual increase after the elections will depend on a combination of global market trends, fiscal decisions and policy priorities in the weeks ahead.