The LPG price of the domestic cylinders in Delhi was raised by Rs 50 per unit on Sunday. The new price of Rs 769 per 14.2 kg LPG cylinder will be applicable in the national capital from 12am tomorrow. This is the third time, LPG price rise since December last year. On December 1, 2020, the price was hiked by a similar Rs 50 per cylinder, followed by a hike of ₹50 again on December 16 due to the firming of international prices.
This is also a second-time price hike in the month of February. The oil marketing companies had increased the price of non-subsidized LPG cylinders by ₹25 in metro cities on February 4.
The rise in the price of LPG comes at a time when petrol and diesel prices in India have touched an all-time high. The cooking gas is derived from crude oil and natural gas.
The price of LPG gas cylinders is determined by state-run oil companies and is revised on a monthly basis. Depending on international fuel rates and US dollar-rupee exchange rates, the prices can go up or down.
On Wednesday, cooking gas LPG price was hiked by a steep Rs 144.5 per cylinder due to spurt in benchmark global rates of the fuel. But to insulate domestic users, the government almost doubled the subsidy it provides on the fuel to keep per cylinder outgo almost unchanged.
LPG price was increased to Rs 858.50 per 14.2 kg cylinder from Rs 714 previously, according to a price notification of state-owned oil firms.
It was the steepest hike in rates since January 2014 when prices had gone up by Rs 220 per cylinder to Rs 1,241. Domestic LPG users, who are entitled to buy 12 bottles of 14.2-kg each at subsidized rates in a year, will get more subsidies.
The government subsidy payout to domestic users has been increased from Rs 153.86 per cylinder to Rs 291.48, industry officials said.
For Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries, the subsidy has increased from Rs 174.86 to Rs 312.48 per cylinder. After accounting for the subsidy that is paid directly into the bank accounts of LPG users, a 14.2-kg cylinder would cost Rs 567.02 for domestic users and Rs 546.02 for PMUY users.
The government gave out 8 crore free LPG connections to poor women under PMUY to increase coverage of environment-friendly fuel in kitchens. Normally, LPG rates are revised on 1st of every month but this time it took almost two weeks for the revision to take place – a phenomenon which industry officials said was due to approvals needed for such a big jump in subsidy outgo.
Others said the decision to defer the increase could have been because of assembly elections in Delhi. Delhi voted on February 8.
