This Week in Explainers: Why India’s fuel price hike is needed to absorb oil shocks

India is feeling the pinch of a stalemate between Iran and the United States. As the conflict between the two rivals completes 10 weeks, global energy supplies remain disrupted due to the Strait of Hormuz being largely closed. India, which bucked the global trend of fuel price hikes since the war began in late February, has finally caved in.

The impact of the war in West Asia became more pronounced when Prime Minister Narendra Modi called for a revival of Covid-era measures to conserve fuel. Since then, India has banned sugar exports, raised import duty on gold and silver and increased milk prices.

PM Modi is on a five-nation tour. The Indian leader’s trip began with a short stopover in the United Arab Emirates (UAE). Albeit a brief visit, it has produced substantive outcomes for the two allies.

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Here’s all this and much more in our weekly roundup from India.

1. After resisting for more than two months since the Iran war triggered a global energy crisis, India has finally hiked petrol and diesel prices by Rs 3 per litre. The decision comes amid a series of other measures taken as tensions in West Asia continue to push global crude oil prices up and disrupt energy supplies.

This is the first time India has increased fuel prices in four years. Despite the rise in petrol and diesel prices, the hike is minimal compared to that seen in other countries. Asia is highly dependent on the Strait of Hormuz for its oil and gas supplies. Thus, the energy crisis has disproportionately hit countries in the region. We take a look.

2. Days before India hiked fuel prices, PM Modi called for the return of Covid-era measures like remote work “in the national interest” to conserve fuel amid the conflict in West Asia. At a public meeting in Hyderabad, he urged citizens to use petrol and diesel with restraint, cut back on overseas travel and halt gold purchases for a year.

He also suggested using public transport, working from home, reducing the consumption of cooking oil, and carpooling to conserve fuel. But why are these measures needed? Will they help India absorb the oil shocks? Read our report.

3. As the war in West Asia creates ripples in India, PM Modi travelled to the UAE briefly as a part of his five-nation tour. The trip comes as the South Asian country is the world’s third-largest energy consumer.

The war in Iran has disrupted global energy supplies, with India also feeling the impact. Modi's crucial visit to the UAE, where Iran has targeted US military bases, produced significant outcomes. The two countries have agreed to a framework for a strategic defence partnership, as well as signed pacts on strategic petroleum reserves and the supply of liquefied petroleum gas (LPG). Read our report.

4. Hopes of lakhs of students across India who gave their National Eligibility cum Entrance Test (NEET) UG exam on May 3 were dashed after allegations of a paper leak. This led to the cancellation of the test conducted by the National Testing Agency (NTA).

The police have discovered a well-organised, multi-state network spanning Maharashtra, Kerala, Haryana, Bihar, Rajasthan and Uttarakhand. At least 45 people are suspected of being involved in the NEET-UG 2026 paper leak case. The cancellation of the test has left over 22 lakh aspirants who had appeared for the paper angry and emotionally exhausted. But how did the NEET-UG paper leak happen? We explain here.

5. After 10 days of suspense, the Congress revealed its pick of the chief minister for Kerala. VD Satheesan trumped KC Venugopal and Ramesh Chennithala to emerge as the top choice of the party’s high command for the post.

The 61-year-old lawyer-turned-politician has been credited for the victory of the Congress-led United Democratic Front (UDF) in the Assembly polls. In his first comments after being announced as the Kerala Congress Legislative Party leader, Satheesan promised to deliver good governance, which will focus on building “a new Keralam for the youngsters”. But who is he? Read here.

6. The H-1B work visa could become a costly dream for Indians. The US administration has proposed increasing the minimum wages paid to H-1B visa workers by 30 per cent.

Indians are the largest beneficiaries of this non-immigrant work visa, which allows US companies to temporarily hire skilled foreign workers. The Trump administration's proposal means higher salaries for H-1B workers. However, it is not that simple. Experts warn that the move could discourage American employers from hiring foreign workers. We explain here.

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