India should fix the retail price of petrol and diesel in a transparent manner, indexing it to the international crude oil prices and dollar-rupee exchange, trade think tank GTRI has suggested.

With a growing apprehension that the Modi government would soon be raising pump prices after holding off the hike for more than two months for electoral considerations, the think tank said that there should be a published formula in public domain, taking into account refining cost and taxes.

The proposal comes at a time of extreme volatility in global energy markets. As of May 9, 2026, Brent crude futures were trading around $100–101 per barrel after fluctuating sharply between $58.72 and $126.4 during the past year. In April 2020, prices had briefly fallen below $20 per barrel.

Last week the government said state-run oil marketing companies are losing close to ₹30,000 crore a month due to under-recoveries.

The first step, according to GTRI founder Ajay Srivastava, will be converting crude oil prices to Indian rupee, followed by blending of ethanol at the rate of 20 per cent. The third step will require adding refining, transport, marketing and dealer margins, before adding central and state levies.

“GTRI argues that the framework would not necessarily make fuel cheaper, but would make pricing more transparent and credible. Every component of the final pump price — crude cost, exchange rate, ethanol blending, OMC margins and taxes — would become visible,” he said.