LPG Price Hiked Again: Why It Is Worrisome And Here's How Much You Pay For A Cylinder Now

Cooking gas cylinders used by households turned dearer at the start of the month of March, with national oil marketing companies increasing the price of 14.2 kg liquefied petroleum gas (LPG) refill by ?25 each. This turned the cylinder to cost ?819 in Delhi, according to Indian Oil Corporation.

BCCL

The exponential surge in prices caused Opposition's uproar and persistent demand for a discussion on the increase in petrol, diesel and LPG prices on Monday that led to washout of the day¡¯s proceedings in Rajya Sabha. The upper house which met for the first time in the second part of the Budget Session saw repeated adjournments as the Opposition continued protests inside the House.

RSTV

Indian Oil, the country's largest fuel retailer, supplies LPG under the brand Indane. Usually, the rates of non-subsidised LPG cylinders are reviewed on a monthly basis and any changes effected on the first day of each month. Cooking gas rates vary in different parts of the country due to local taxes.

Priced hiked thrice in February

Domestic LPG cylinder price was hiked from Rs 694 a cylinder in January 2021 to Rs 719 a cylinder on February 4. The price was once again hiked by Rs 50 to Rs 769 a cylinder on February 15 in the national capital. A third price hike of Rs 25 per cylinder was done on February 25.

Times Internet

The rise in the price of LPG comes at a time when petrol and diesel prices in India have touched an all-time high. Cooking gas is manufactured from crude oil and natural gas. Usually, the rates of non-subsidised LPG cylinders are reviewed on a monthly basis and any alterations are implemented on the first day of every month. Cooking gas rates vary in different parts across the country due to variation in local taxes.

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Factors determining price of LPG

The prices of LPG cylinders in the country, both cooking and commercial, are determined by the state-run oil marketing companies. As per the current rules, the government subsidies a total of 12 cylinders of 14.2 kilograms each per household every year. The customer has to make any additional purchases required of the LPG cylinders based upon the market price. The amount of the subsidy provided by the government on the annual quota of 12 refills varies from month to month. The subsidy on LPG is determined broadly by factors such as crude oil as well as foreign exchange rates.

BCCL

Why the surge is worrisome

According to officials in the know, all consumers will have to bear the burden of these hikes with nil subsidy being borne by the Centre at the current price. The Centre had stopped offering financial support to consumers in the form of a direct benefit transfer (cash transfer to bank account of beneficiary) of LPG subsidy.

BCCL

It started eliminating LPG subsidy from around June 2020 onwards through small but sustained hikes in the price of subsidised domestic cylinders. After the LPG subsidy was pruned, the oil marketing companies also reduced LPG prices and then kept it unchanged at Rs 594 a cylinder from July to November-end 2020.