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After a hike in petrol and diesel prices, the common man suffered another setback as the rates of non-subsidised cooking gas (LPG) cylinder was on Tuesday hiked by INR 16.50 per cylinder. Non-subsidised cylinders are those that customers buy after exhausting their quota of 12 subsidised refills.

The increase has come in the wake of the Iraq crisis due to which crude oil prices went up by $ 4 per barrel. India is a net importer of crude oil which is processed to produce petrol, diesel and LPG.  According to India’s largest oil retailer, the Indian Oil Corporation (IOC), each non-subsidised 14.2-kg cooking gas cylinder will now cost INR 922.50 in Delhi, up from INR 906. Non-subsidised LPG rates were cut by INR 23.50 per cylinder last month.

Since February, there was no hike in the prices of non-subsidised domestic cooking gas cylinders. In fact, each month the rates were cut by an upward of INR 50. This was due to steady Arab-Gulf LPG prices, which is linked to Indian LPG rates.

Prices of domestic LPG typically rise from November to March due to a spike in demand during the harsh winter in Europe and the US. Since Indian prices have been linked to international gas prices, the prices shoot up here too.

But rise in international LPG prices during summer comes due to escalating Iraq crisis and subsequent pressure on crude prices in June. State-owned oil companies revise rates of non-subsidised LPG on the 1st of every month, based on the average imported cost and rupee-US dollar rate during the previous month. The rates of subsidised cylinders, however, have not been changed.

Source-On Request