Fuel Shortage Stalls Flights, Trucks; Oppn. Asks Panjab Govt. to Reduce Diesel Cost

June

2026

Given the shortage of fuel due to the ongoing closure of Strait of Hormuz, India's two major airlines, Air India and IndiGo, have announced a reduction of 250 (22%) domestic flights every day during the June–August period. Mumbai, Delhi, and Bengaluru are the worst-affected cities in terms of fewer flight options and higher fares. Additionally, about a fifth of India’s trucks have gone off the roads, putting the squeeze on goods transport as the industry battles diesel shortages in several states and a sharp rise in fuel prices. The shortage of trucks is pushing up freight rates, threatening to exert additional inflationary pressures. The worst affected are small truck operators, who account for more than 70% of India’s 9.5M-strong, highly fragmented, trucking fleet which is now battling mounting operational costs and reduced earnings. In Panjab, the Opposition has demanded a reduction in diesel prices by USD 0.05 (INR 5) per liter to provide relief to farmers during monsoon paddy sowing season. If the Aam Aadmi Party government, which is already struggling to pay salaries and manage mounting liabilities, agrees to absorb the burden, the move could cost the state exchequer nearly USD 173M annually. Panjab Bharatiya Janata Party (BJP) spokesperson Pritpal Singh Baliawal said the Panjab government was currently levying 16.58% Value Added Tax along with an additional 10% tax on petrol, resulting in approximately USD 0.2 (INR 19) per liter being collected in taxes. This is ironic because though the BJP-led government has not released exact figures, the estimate is that it earned more than USD 300B through highly taxed retail oil prices between 2014–25 when international crude price was low but never passed on the benefits of cheaper international crude to consumers. Meanwhile, with 17 ships carrying India-bound fertilizer stranded in the Persian Gulf since conflict broke out in West Asia, the Indian government is considering moving the dry bulk commodity by road from their current locations—after the ships dock—to Yanbu Port in Saudi Arabia and from there by ships to Indian ports. The Fertilizer Department officials informed an informal Group of Ministers that they are exploring this option, though this route via road and the Red Sea is longer by 1,200 kms (earlier coverage).