Shares of Indian Oil Corporation (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) are likely to remain in focus as investors react to the Centre’s latest changes in fuel export taxes. The government has increased the windfall tax on diesel and aviation turbine fuel (ATF) exports, while removing the export duty on petrol for the fortnight starting October 31.
The revised tax structure may have a mixed impact on oil marketing companies. A higher export duty on diesel could reduce refining margins and put some pressure on export earnings. At the same time, the removal of petrol export duty is expected to provide relief and improve profitability from petrol exports.
According to the notification, the export duty on ATF has been increased to ₹11 per litre from ₹10.5 per litre. The special additional excise duty and cess on diesel exports have also been raised from ₹8.5 per litre to ₹11.5 per litre. Meanwhile, the duty on petrol exports has been reduced from ₹2.5 per litre to zero.
The government had introduced windfall taxes to ensure adequate domestic fuel supplies and prevent exporters from gaining excessive benefits from higher global fuel prices. These tax changes are expected to influence investor sentiment towards OMC stocks in the coming trading sessions.