Domestic LPG prices were hiked by Rs 3.50 per cylinder on Thursday, the second such increase this month due to rising international crude oil costs. According to news agency ANI, the price of a cylinder has already surpassed Rs 1,000.
The price of a commercial cylinder has also risen by Rs 8. A household LPG cylinder will now cost Rs 1,003 in Delhi and Mumbai, Rs 1,029 in Kolkata, and Rs 1,018.5 in Chennai due to the price increase.
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The price of LPG is tied to global LPG costs, which have been rising owing to supply issues caused by the Russia-Ukraine war. LPG prices have been steadily growing since November 2020, with the price of a 14.2 kg cylinder in Delhi increasing by more than Rs 400, or over 70%, during that timeframe.
Crude oil prices have steadily risen due to a resurgence in demand following Covid-related restrictions, the sluggish restoration of crude oil output by oil-exporting countries, and the Russia-Ukraine war, all of which have contributed to increased LPG costs.
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The price increase has occurred at a time when most customers’ subsidies for cooking gas have been eliminated. In May 2020, the government discontinued LPG cylinder subsidies through its direct benefits transfer system for all consumers, with the exception of clients in remote locations that suffer high inland freight expenses from ports to bottling facilities.
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According to research conducted by the Council on Energy, Environment, and Water, more than 70% of Indian homes utilised LPG as their primary cooking fuel in March 2020, and 85% had LPG connections.