Petrol and diesel prices will not be increased for now despite international crude oil rates crossing USD 100 per barrel, government sources said on Monday, as authorities stepped up efforts to maintain uninterrupted fuel supplies across the country.

As the conflict in West Asia entered its tenth day, world markets tumbled and Brent crude surged to nearly USD 120 a barrel, about 65 per cent higher than when the war began, before retreating.

Top government sources said there is no immediate plan to raise retail fuel prices and oil marketing companies are expected to absorb the current cost pressure for the time being.

India has adequate stocks of crude oil and finished fuels to meet requirements for the next 6–8 weeks, they said. However, the government has tweaked the policy for booking cooking gas refills to prevent hoarding.

The minimum gap for booking a domestic LPG refill has been increased to 25 days from 21 days. Average households consume 7–8 LPG cylinders of 14.2 kg in a year and should normally not need a refill in less than six weeks, sources said.

The widening conflict in the Middle East, which began on February 28 when the United States and Israel carried out strikes on Iran followed by retaliatory attacks from Tehran, has disrupted energy flows through the Strait of Hormuz.

The shipping corridor is crucial for India's energy supplies, with about 40–50 per cent of crude imports and nearly 85–90 per cent of LPG shipments from Gulf nations passing through the route.

Sources said crude oil can be sourced from alternatives such as Russia, but replacing LPG supplies is more time-consuming as other sources are largely located in the United States and Canada.

To ensure uninterrupted supplies, the government has ordered refineries to maximise LPG production and avoid diverting streams to petrochemicals.

On petrol and diesel, the situation is “very comfortable”, one source said.

“Every petrol pump in the country is functioning, every piped natural gas connection is operational and every CNG station is open. There is no cause for panic,” he said.

India imports about 88 per cent of its crude oil requirement, meaning higher global prices translate into a larger import bill and potential inflationary pressures.

However, retail fuel prices are unlikely to be raised immediately as the government follows a policy of allowing companies to build margins when global prices are low and cushioning consumers when rates rise.

Petrol and diesel prices have remained frozen since April 2022, with Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd absorbing losses when crude prices are high and making profits when rates are low.

Officials said oil companies have enough financial cushion to withstand the current price spike.