Commercial LPG cylinder price reduced by Rs. 115.5 in Delhi
What's the story
The price of commercial liquefied petroleum gas (LPG) cylinders has been reduced by Rs. 115.5 in Delhi on Tuesday, bringing the cost of the 19kg cylinder down from Rs. 1,859.5 to Rs. 1,744. The price of the same was slashed in other metros, too. Commercial LPG cylinders are currently retailing at Rs. 1,846 in Kolkata, Rs. 1,696 in Mumbai, and Rs. 1,893 in Chennai.
Context
Why does this story matter?
The commercial cylinder price has been slashed for the third consecutive month after it peaked in May at Rs. 2,354. The price differs from state to state depending on the value added tax (VAT) and local transportation costs. It is also calculated on the basis of international crude oil prices, and its rising costs earlier prompted oil manufacturing countries to increase the rates.
Information
No change in domestic LPG price
However, the non-subsidized price of domestic 14.2kg LPG cylinders remains the same at Rs. 1,053 in Delhi, as per the Indian Oil Corporation Limited's (IOCL) website. While domestic LPG cylinders are sold at open market rates, the Centre provides subsidies on 12 cylinders annually to beneficiaries under the Pradhan Mantri Ujjwala Yojana (PMUY) via a direct benefit transfer to their bank accounts.
Information
Commercial LPG price cuts in metros
Thanks to the latest revision in the commercial LPG cylinder prices, both Delhi and Mumbai reportedly saw a reduction of Rs. 115.5 per cylinder, while Chennai saw a decrease of Rs. 116.5. Kolkata, however, saw the highest price cut of Rs. 149.5 on Tuesday.
Loss
Petrol, diesel prices could be cut by 40 paise
Meanwhile, oil marketing companies (OMCs) are also likely to reduce the prices of petrol and diesel by 40 paise per liter over the next five days, reported CNBC Awaaz. To note, due to the sale of fuel below cost, IOCL reported a net loss of Rs. 272.35cr for the July-September quarter, in contrast to its Rs. 6,360.5cr profit in the same quarter in 2021.
Imports
India imports 85% of its total petroleum requirement
India relies on foreign purchases to meet approximately 85% of its oil requirements, making it one of Asia's most vulnerable to rising oil prices. While India has excess oil refining capacity, it does not produce enough LPG to cope with its increasing domestic demands and imports large amounts of the same from countries like Saudi Arabia, Livemint reported earlier.