State-run fuel retailers hiked the price of domestic cooking gas by Rs 29 per cylinder on June 7, marking the second increase in under three months as rising global energy costs squeeze margins. The price of a standard 14.2-kg liquefied petroleum gas (LPG) cylinder in Delhi has moved up from Rs 913 to Rs 942, industry sources told PTI.
The latest revision follows a Rs 60-per-cylinder rise implemented on March 7, which came amid heightened geopolitical tensions and conflict in West Asia that disrupted supplies and pushed international fuel prices higher. Despite the two increases, oil marketing companies (OMCs) are still estimated to be selling LPG below procurement cost.
Before the June 7 adjustment, state-run firms were losing an estimated Rs 703 on every domestic LPG cylinder sold, according to industry estimates cited by PTI. The Rs 29 hike only partially narrows that gap, leaving substantial under-recoveries as global energy rates remain elevated.
The LPG revision comes against the backdrop of broader fuel price inflation in India. Since mid-May, petrol and diesel have climbed by a cumulative Rs 7.50 per litre, while compressed natural gas (CNG) prices have risen by nearly Rs 6 per kilogram. Despite these increases, OMCs continue to sell petrol and diesel below cost, with estimated under-recoveries of around Rs 11 per litre for petrol and Rs 33.6 per litre for diesel.
The government has so far avoided passing the full burden of higher international fuel costs to consumers, electing to have state-owned retailers absorb a portion of the rise. That strategy has helped limit immediate price shocks for consumers but has strained the finances of OMCs, forcing periodic retail revisions to reduce mounting losses.
Analysts say further adjustments cannot be ruled out if international crude and product prices stay high. For consumers, the modest incremental rise in LPG will add to household energy costs, particularly for lower-income families that rely on subsidised cylinders.
