Due to high crude oil prices, a weak rupee, and government fuel-saving drives, demand for petrol and diesel in India is expected to decline. The energy analytics firm Kpler has reduced its projected fuel demand growth rate in 2026 by 39%. The cost of transportation has increased by 19% owing to the situation in Iran. This might influence government expenditure and prices in the market.

In addition, Kpler has also reduced its projections regarding India's refined product demand growth in 2026. The revised figure stands at approximately 78,000 barrels per day from 128,000 barrels per day. The demand growth rate projection for the petrol sector has been reduced from 63,000 barrels per day to 38,000 barrels per day. Experts believe that rising fuel prices and economic pressures may lead people to reduce non-essential travel.

The report states that increased work from home, a decrease in non-essential travel, and the government's fuel-saving campaign will directly impact diesel and petrol demand. Annual diesel demand is expected to decline by approximately 20,000 barrels per day. Furthermore, demand for aviation fuel (ATF) is also estimated to decline by approximately 50 percent. According to experts, due to the international situation and high oil prices, people are trying to reduce travel expenses.

Experts say that crude oil remains increasingly expensive in the international market. The government has raised petrol and diesel prices three times in recent days, but despite this, current prices are said to be lower than the oil companies' estimated costs. The average price of petrol in the country is around ₹103 per liter, while for cost equilibrium, it should be around ₹125 per liter. Similarly, the current average price of diesel is around ₹94 per liter, while the equilibrium level is estimated to be ₹115 to ₹120 per liter.

The impact of the Iran war is now being felt on delivery and logistics costs in the Asia-Pacific region. According to a survey, delivery costs in Asia, including India, increased by up to 19 percent between March and May. Fuel prices, increased driver salaries, and urban congestion are cited as the main reasons for this. Experts say that if this situation continues, prices of everyday commodities may also be affected in the future.