NEW DELHI, June 7: Indian households continue to pay among the lowest prices for cooking gas globally despite a sharp rise in international LPG prices triggered by disruptions in West Asia, the Government said on Sunday, a day after increasing domestic LPG prices by Rs 29 per cylinder.
The price of a 14.2-kg domestic LPG cylinder in Delhi was raised to Rs 942 from Rs 913, while beneficiaries of the Pradhan Mantri Ujjwala Yojana (PMUY) will continue to pay an effective Rs 642 per cylinder after receiving a subsidy of Rs 300 per refill on the first four refills annually, down from 9 refills announced last year.
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The increase follows a Rs 60-per-cylinder hike on March 7, taking the cumulative hike to Rs 89 per 14.2-kg cylinder. State-run oil marketing companies were estimated to be losing about Rs 703 on every LPG cylinder sold before the latest revision.
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In a statement, the Government said the cost of supplying a domestic LPG cylinder has risen to more than Rs 1,600 following a surge in international prices that followed the outbreak of war in West Asia at the end February.
India’s LPG import costs are linked to the Saudi Contract Price (CP), the global benchmark for the fuel. The benchmark has risen about 46 per cent since February after disruptions linked to the Strait of Hormuz tightened supplies from the Gulf region, according to the statement.
Despite the increase, domestic LPG prices remain below those prevailing in neighbouring countries such as Pakistan, Nepal, Bangladesh, and Sri Lanka, and significantly lower than prices in advanced economies, including the United States, Australia, and Canada, the Government said.
The Government also said India was among the few countries able to maintain uninterrupted energy shipments through the Strait of Hormuz during the crisis, ensuring there was no shortage of LPG or other petroleum products in the country. Domestic LPG production was increased and supplies diversified through alternative sourcing arrangements to safeguard availability, it added.
According to the statement, cumulative under-recoveries on domestic LPG sales rose to about Rs 60,000 crore by the end of the previous financial year, compared with Rs 41,338 crore a year earlier. The Union Cabinet has approved Rs 30,000 crore in compensation to state-run oil marketing companies to partly offset these losses. (PTI)
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