LPG price hiked again, domestic cylinder to cost ₹25 more

Second upward revision in five days; fourth since February 4

Cooking gas cylinders used by households turned dearer on March 1, with national oil marketing companies increasing the price of 14.2 kg liquefied petroleum gas (LPG) refill by ₹25 each.

It is the second such increase in five days. The new rate is effective for deliveries made from March 1 onwards.

In Delhi, the cylinder will now cost ₹819 (from ₹794); in Kolkata, ₹845 (₹820); in Mumbai, ₹819 (₹794) and in Chennai, ₹835 (₹810). In Hyderabad, households need to pay ₹871.50 (₹846.50) for the refill.

This is the fourth increase in LPG prices from February 4 and the sixth since December 2020, totally adding ₹225 to the cylinder cost. LPG prices remained unchanged in January. The cylinder prices were increased twice by ₹50 in December by the three companies, Indian Oil Corporation, BPCL and HPCL, which command the lion’s share of the LPG market in the country.

In February, the price per cylinder went up by ₹25 on February 4, by ₹50 on February 15 and by another ₹25 on February 25. The pricing of LPG is determined by the international prices of propane and butane and U.S. Dollar-Rupee exchange rate.

There is a small subsidy component on the cylinders for eligible customers. The subsidy, paid directly into users’ bank accounts, is only for the first 12 cylinders purchased in a year. The subsidy varies across the country and, according to sources, has remained unchanged for some months now though the prices have been increased several times.

The subsidy is about ₹40 per cylinder in Hyderabad and ₹25 in Chennai. Since a Direct Benefit Transfer (DBT) of the subsidy is done, the eligible households, including the economically weak that were made to switch from kerosene and firewood to LPG under the Ujjwala scheme, need to pay the prevailing price at the time of taking delivery.

Commercial-use cylinders

Besides domestic LPG, the price of 19 kg cylinder meant for use in commercial establishments, primarily tea stalls, eateries and restaurants, was also increased on Monday. In Hyderabad, the price increased by ₹103, taking the cost of the cylinder to ₹1,773 each.

The upward revision in LPG prices as well as those of petrol and diesel have come in for severe criticism of the government, with some Opposition leaders cycling or riding electric two-wheelers to work in protest against the increase and even sitting on LPG cylinders while addressing the media.

Union Minister of Petroleum and Natural Gas Dharmendra Pradhan was recently quoted by a news agency as saying that fuel prices were expected to moderate by the end of winter.

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