The government kept in place a 0.2 euro-per-litre cut on diesel duties but limited the reduction to €0.05 per litre for petrol, arguing that diesel prices have risen faster than petrol.
Prime Minister Giorgia Meloni announced the measure following a cabinet meeting.
"This allows us to block an increase that would impact significantly on the lives of citizens," Meloni said.
Italy first approved a cut in fuel taxes in March following the outbreak of the conflict after the US and Israel began bombing Iran on February 28.
Italy depends on energy imports and has been particularly concerned about global oil price rises because of the effective blockage of the Strait of Hormuz, a vital shipping lane.
The government has now extended excise tax cuts twice at a cost of hundreds of millions of euros. The latest extension had been due to expire on Friday.
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