The oil and gas industry has sought abolition or a review of the oil industry development (OID) cess on crude oil produced from nomination and pre-NELP exploration blocks in the FY27 Union Budget, citing adverse impact on domestic production and project viability. OID cess, levied under the Oil Industries (Development) Act, 1974, was converted from a specific rate to an ad-valorem levy of 20 per cent from March 1, 2016, following a sharp fall in global crude prices. While the shift to an ad-valorem structure was intended to provide relief, oil and gas industry association Federation of Indian Petroleum Industry (FIPI) in a representation for FY27 Budget to the finance ministry said the 20 per cent rate has proved excessive, noting that historically the cess has ranged 8-10 per cent of crude prices. The cess applies only to crude produced from nomination and pre-New Exploration Licensing Policy (NELP) blocks, many of which are mature and in decline, requiring higher investment to ...