LPG price hiked by Rs 50; Rates increased by Rs 244 in one year
New Delhi:
LPG price on Wednesday was hiked by Rs 50 per cylinder, the eighth hike in rates in the past one year, taking the cumulative increase to Rs 244.
According to the price notification of state-owned fuel retailers, the price of non-subsidised LPG is now Rs 1,053 per 14.2 kg cylinder in the national capital, up from Rs 1,003 earlier.
Non-subsidised cooking gas (LPG) prices have risen eight times in the past one year due to firming international energy prices. Overall, the rates have increased by Rs 244 per cylinder or 30 per cent.
Common households pay non-subsidised rates for cooking gas after the government restricted subsidies to poor beneficiaries getting connections under the Ujjwala scheme.
This is the fourth increase in LPG rates since the Ukraine war. On March 22, the prices were increased by Rs 50 per cylinder and again on May 7 by the same amount. On May 19, the prices increased by Rs 3.50 per cylinder.
Out of the increase of Rs 244 per cylinder in the last one year, the increase of Rs 153.50 has come from March 2022.
The opposition Congress termed the hike as an “anti-people” decision and asked whether it was the “cost” of toppling the Maharashtra government.
In a tweet in Hindi, Congress general secretary Priyanka Gandhi Vadra said the BJP in its national executive meeting talked about the welfare of the poor, while imposing a 5 per cent “Gabbar Singh Tax (GST)” on flour, cereals, curd and paneer. And then broke the back of the poor and middle class by raising the price of domestic LPG by Rs 50.
However, petrol and diesel prices remained stable for the third consecutive month. Rates were hiked by a record Rs 10 per liter after a case stoppage of 16 days starting March 22.
In May, the government had cut excise duty on petrol by Rs 8 per liter and on diesel by Rs 6 per liter to pacify rising inflation.
At that time, the government had also said that the Rs 200 per cylinder subsidy on cooking gas would be limited to only 9 crore poor women and other beneficiaries who got free connections under the Ujjwala scheme and the remaining users including households would pay the market price ( also known as the non-subsidy rate).
Originally, non-subsidised cooking gas was what consumers bought after exhausting their quota of 12 cylinders at subsidized or below-market rates. However, the government stopped subsidizing LPG to households in mid-2020.
Non-subsidised LPG costs Rs 1,052.50 per 14.2 kg cylinder in Mumbai, while it costs Rs 1,079 in Chennai and Rs 1,068.50 in Kolkata.
Rates vary from state to state depending on the incidence of local taxes such as VAT. Prices are higher in states with higher taxes.
Simultaneously, the oil companies also reduced the price of commercial LPG cylinders – which are used by establishments such as hotels and restaurants. It is now priced at Rs 2,012.50 per 19 kg in the national capital, which is lower than Rs 2,021 per cylinder.
Industry sources said the prices of commercial LPG were almost in line with the cost, while LPG used in domestic cooking was being sold at a discount.
The reduction in commercial LPG rates reflects a moderation in Saudi CPP prices while domestic LPG rates are being adjusted upward to align closer to cost.
Domestic LPG rates are around Rs 300 less than their actual cost.
International oil prices have risen this year. They hit a 13-year high of $140 a barrel in March before losing some gains. On Wednesday, Brent was trading at $103.92 per barrel.
To compound things, the Indian rupee settled at Rs 79.24 per dollar, making imports costlier.
India depends on foreign purchases to meet about 85 percent of its oil requirement, making it one of the most vulnerable countries to high oil prices in Asia.
While India has excess oil refining capacity, it does not manufacture enough LPG to meet domestic demand and imports significant quantities from countries such as Saudi Arabia.