Domestic LPG prices raised by Rs 29 per cylinder

NEW DELHI, JUN 7 (IANS/AGENCIES): Domestic cooking gas prices were increased by Rs 29 per cylinder on Sunday, marking the second hike in three months amid rising global energy costs.
With effect from June 7, the price of a 14.2-kg domestic LPG cylinder in Delhi has gone up from Rs 913 to Rs 942. The hike follows a Rs 60 increase announced on March 7 after tensions in West Asia disrupted global energy markets and pushed up international fuel prices.
Despite the latest revision, the Ministry of Petroleum and Natural Gas (MoPNG) said public sector Oil Marketing Companies (OMCs) continue to incur heavy losses on domestic LPG sales.
OMCs still losing Rs 700 per cylinder: According to the ministry, OMCs are suffering an under-recovery of around Rs 700 on every domestic LPG cylinder sold. The cost of supplying a cylinder has risen to over Rs 1,600 as the Saudi Contract Price (CP), the benchmark for LPG imports, has increased by 46 per cent since February 28.
The ministry pointed out that the disparity is evident when compared to commercial LPG prices. A 19-kg commercial cylinder used by hotels and restaurants now costs Rs 3,113.50 in Delhi, or about Rs 164 per kg, following five price hikes during the West Asia crisis. In contrast, domestic consumers pay about Rs 66 per kg even after the latest increase.
For beneficiaries under the Pradhan Mantri Ujjwala Yojana (PMUY), the effective price of a domestic cylinder remains Rs 642 after subsidy support.
The ministry said the gap between the international cost of LPG and the regulated retail price is partly borne by OMCs and partly compensated by the government. Cumulative under-recoveries on domestic LPG rose sharply to around Rs 60,000 crore in the last financial year from Rs 1,338 crore a year earlier. The Union Cabinet has approved compensation of Rs 30,000 crore to OMCs.
The LPG price hike comes amid increases in other fuels as well. Petrol and diesel prices have risen by a cumulative Rs 7.50 per litre since mid-May, while compressed natural gas (CNG) prices have gone up by around Rs 6 per kg.
The ministry said disruptions around the Strait of Hormuz, through which about 54 per cent of India’s LPG imports are routed, have significantly impacted supply and costs.