By Sadananda Mohapatra, Senior Business Journalist
India Lifts Fuel Curbs as Hormuz Shock Eases. Prices Tell a Different Story
India will lift its emergency restrictions on petrol and diesel sales from July 1, the Ministry of Petroleum and Natural Gas confirmed this week, ending curbs first imposed on June 12 amid the West Asia crisis. The 200-litre daily cap on bulk diesel purchases is being scrapped, and commercial, industrial and institutional buyers can return to regular retail pumps without restriction. Commercial LPG supplies were already restored to pre-crisis levels in late June, with bulk LPG relaxed to 50% of earlier consumption volumes. The curbs, originally intended to run up to three months, lasted under three weeks.
The reversal reflects how quickly supply stabilised. Diesel, which accounts for roughly 39% of India’s total petroleum product consumption, bore the brunt of the original restrictions, disrupting irrigation pumps during the kharif sowing season and creating operational strain for small and medium enterprises. With shipping through the Strait of Hormuz stabilising and India’s diversified import basket absorbing the shock, officials maintained throughout that national reserves of crude, petrol and diesel remained adequate.
What has not moved is the price at the pump. Delhi petrol has held steady at Rs 102.12 per litre [$1.07] and diesel at Rs 95.20 per litre [$1.00] since May 25, when the last hike of Rs 2.61 and Rs 2.71 per litre respectively was applied. Mumbai petrol sits above Rs 111 [$1.16], with several cities including Bengaluru, Hyderabad and Kolkata above Rs 110. Brent crude, meanwhile, has been trading near $75 a barrel, having corrected from its conflict-driven peak. The government has chosen not to pass any of that relief through to retail consumers, just as it chose not to pass the earlier spike through during the crisis.
This is a consistent pattern, not a one-off decision. Holding pump prices steady regardless of which direction crude moves protects household budgets and keeps inflation predictable, but it does so by transferring the volatility onto oil marketing company balance sheets and, eventually, the exchequer. The same mechanism that absorbed Rs 60,000 crore in LPG under-recoveries earlier this year is now absorbing whatever margin compression comes from holding petrol and diesel prices flat while crude corrects downward.
The broader lesson for India’s energy planning is less about this specific episode and more about its speed. Restrictions imposed in under two weeks were lifted in under three. That kind of agility is reassuring. But it does not change the underlying exposure: India still imports more than 85% of its crude requirement, and every Hormuz-style disruption will keep testing the same emergency playbook. Accelerating domestic energy sources, renewables, storage, nuclear and green molecules, is not just a climate commitment. It is the only long-term hedge against repeating this cycle.
Joules Capsule
Quick reads from the world of energy this week
Telangana Clears State’s First Standalone Battery Storage Project
The Telangana Electricity Regulatory Commission has approved the state’s first utility-scale standalone Battery Energy Storage System, totalling 375 MW and 1,500 MWh, following a public hearing on June 18. The project, tendered by Telangana Power Generation Corporation, is split between Coal India and Sarus Infrastructures at substations in Choutuppal and Maheswaram, each contracted to supply four-hour discharge duration. Stakeholders had questioned why Telangana’s tariffs ran higher than neighbouring Andhra Pradesh, with developers explaining that the longer discharge window better suits the state’s evening demand pattern, helping absorb daytime solar surplus while reducing costly peak-hour power purchases.
Centre Extends Full-Capacity Mandate for Tata Power’s Mundra Plant to September
The power ministry has extended its Section 11 directive requiring Tata Power’s 4,150 MW Mundra plant to run at full capacity through September 30, originally set to expire on June 30. The Gujarat-based facility, which runs on imported coal and supplies half its output to the state, resumed operations in April after a nine-month shutdown caused by financial strain from cost-tariff mismatches. The extension reflects continued dependence on imported coal-based generation to meet an estimated peak demand of 270 GW this summer, even as the broader fleet of 18.7 GW of similar plants is being gradually weaned onto domestic coal.
Gujarat Proposes Cutting Green Energy Banking Charge to Rs 1 per Unit
The Gujarat Electricity Regulatory Commission has proposed reducing the banking charge for Green Energy Open Access consumers from Rs 1.50 to Rs 1 per unit [$0.011], effective September 1, 2026 through March 31, 2027. The interim rate follows a study of around 165 open access consumers between April 2025 and January 2026, which estimated actual banking costs at Rs 1.06 per unit. The proposal is part of a draft sixth amendment to Gujarat’s green energy open access regulations, with a public hearing scheduled for July 21. Lower banking charges would improve project economics for industrial and commercial consumers sourcing renewable power through open access.
About the Author:
Sadananda Mohapatra is a veteran business journalist with decades of experience covering India’s energy, industry, and economic landscape. With stints at reputed financial news publications like The Business Standard & NewsWire18, he reported extensively on India’s power sector, minerals policy, coal and energy regulation, and industrial developments — building a deep, ground-level understanding of the global energy economy. His work spans corporate affairs, infrastructure, and policy analysis, with a particular focus on eastern India’s resource-rich industrial corridor. He currently writes on the global energy landscape through his newsletter, The Joule’s Stack.
