Commercial LPG Prices Hiked By ₹10 Per Cylinder Jet Fuel Prices Up 5.6%

(MENAFN- Live Mint) New Delhi: State-run oil marketing companies on Tuesday raised prices of commercial LPG cylinders by around ₹10 per cylinder across key metro cities. Jet fuel prices for domestic airlines have also been increased by over 5%.

In the national capital, the price of the 19-kg commercial cylinder has been raised by ₹9.5 to ₹2,747.50 per cylinder. The price of a 5-kg FTL (free trade LPG) cylinder, which comes under the commercial category, has also increased by ₹2 to ₹764. The price hike comes after two consecutive price cuts in July and August. In July, prices of 19-kg commercial LPG were reduced by ₹183.50, and in August, it was further cut by ₹192.

In Kolkata, Mumbai and Chennai, commercial LPG prices now stand at ₹2,884.00, ₹2,701.00 and ₹2,916.50 per cylinder, up by ₹11.5, ₹9.5 and ₹10.5, respectively, from August.

Rise in international prices

The increase follows a rise in international LPG prices. Over the past one month, the benchmark Saudi Contract Prices (CP) for LPG increased by $5 per metric tonne for propane and $20 per metric tonne for butane.

LPG supplies have been among the areas most affected by the war because India relied on West Asia for about 90% of its cooking gas imports before the conflict. Qatar, Saudi Arabia, the UAE and Kuwait were the main suppliers. During the conflict, the US emerged as India's largest LPG supplier.

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India imports about 65% of its annual LPG requirement of 33 million tonnes, resulting in an import bill of nearly $11 billion. Domestic LPG prices, however, have been kept unchanged.

Rising consumption

Data from the Petroleum Planning & Analysis Cell (PPAC) show that India's LPG consumption rose to a six-month high in July, reaching around 2.37 million tonnes (mt) on a provisional basis, up 8% month-on-month. However, usage was down by almost 16% annually.

The petroleum and natural gas ministry recently informed Parliament that the state-run oil marketing companies (OMC ) have accumulated more than ₹59,000 crore in under-recoveries from the sale of domestic cooking gas as of 31 July, up from around ₹51,000 crore at the end of June, as the war in West Asia disrupted LPG supplies and pushed up global prices.

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Meanwhile, OMCs increased jet fuel prices for domestic airlines in the national capital by ₹6.28 per litre, or 5.46%, to ₹121.28 per litre.

ATF prices were raised by ₹5 per litre in August this year after a reduction in July. The continued increase in jet fuel prices is significant for the aviation sector because fuel accounts for roughly 40% of an airline's overall operating costs.

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