LPG price increased by Rs 50; increase by Rs 244 in one year
New Delhi:
The price of LPG cooking gas on Wednesday increased by Rs 50 per cylinder, the 8th increase within a year, bringing the cumulative increase to Rs 244.
Unsubsidized LPG is currently priced at Rs 1,053 per cylinder of 14.2 kg in the national capital, up from Rs 1,003 previously, according to price announcements by state-owned fuel retailers.
Stable international energy prices have led to an eight-fold increase in unsubsidized gas (LPG) prices over the past year. All in all, the price has increased by Rs 244/cylinder or 30%.
Households typically pay no subsidy for the cooking gas they buy after the government restricted subsidies to only poor beneficiaries with a relationship under the Ujjwala scheme.
This is the fourth LPG rate increase since the Ukraine war. The price rose to Rs 50/pillar on March 22 and again by the same amount on May 7. The price increased by Rs 3.50/pillar on May 19.
Of the Rs 244/cylinder increase in the past year, an increase of Rs 153.50 has occurred since March 2022.
The opposition parliament called the increased decision “anti-people” and asked if it was “the price to pay” for the overthrow of the Maharashtra government.
In a tweet in Hindi, Congress Secretary-General Priyanka Gandhi Vadra said the BJP talked about the welfare of the poor at its national executive meeting while imposing a 5% “Gabbar Singh Tax (GST)” for flour, cereals, curds and biscuits, and then broke the setback of the poor and middle class by raising the price of domestic cooking gas to Rs 50.
However, gasoline and diesel prices continued to freeze for the third consecutive month. The pause follows a record rate increase of Rs 10 per liter within 16 days starting March 22.
In May, the government cut the excise tax on petrol by Rs 8 per liter and diesel by Rs 6 per liter to cool down soaring inflation.
At that time, the government also announced that the subsidy of Rs 200/can for cooking gas will be limited to 9 poor women and other beneficiaries who are connected free of charge under the Ujjwala scheme and those Remaining users including households will have to pay the market price (also known as the unsubsidized rate).
Initially, unsubsidized cooking gas was the gas that consumers used to buy after the quota of 12 cylinders expired at a subsidized rate or below market value. However, the government stopped subsidizing LPG to households in mid-2020.
Unsubsidized LPG costs Rs 1,052.50 per 14.2 kg bottle in Mumbai, while Rs 1,079 per bottle in Chennai and Rs 1,068.50 in Kolkata.
Rates vary from state to state depending on local taxes such as VAT. Prices are higher in states with higher taxes.
Besides, oil companies also reduced the price of commercial LPG cylinders – the type used by establishments such as hotels and restaurants. It is currently priced at Rs 2,012.50 per 19 kg cylinder in the national capital, down from Rs 2,021 per cylinder.
Industry sources say commercial LPG prices are almost in line with cost while cooking gas used in home kitchens is being sold at a discount.
The decrease in commercial LPG prices reflects the decline in CPP prices of Saudi Arabia while domestic LPG prices are being adjusted upwards to match costs.
The domestic LPG price is about Rs 300 lower than the actual cost.
International oil prices have risen this year. They rallied to a 13-year high of $140 a barrel in March before shedding some of the gains. Brent oil traded at $103.92 a barrel on Wednesday.
To combine things, the Indian rupee fell to Rs 79.24 per dollar, making imports more expensive.
India depends on overseas purchases to meet about 85% of its oil needs, making it one of the most vulnerable countries in Asia to higher oil prices.
While India has excess refining capacity, it does not produce enough LPG to meet domestic demand and imports significant amounts from countries like Saudi Arabia.
