LPG price hiked by ₹144.5 per cylinder, steepest since January 2014

Daniel Fowler
February 12, 2020

The price of non-subsidised liquefied petroleum gas (LPG) was spiked on Wednesday. In Kolkata, the price is now at Rs 896.00, up by Rs 149. The new rates would be applicable from today.

With the increase, the subsidy burden for the government will also jump by nearly 100 per cent with Centre deciding against revising the price of the subsidised cooking gas cylinders. In Chennai on the other hand, the price is at Rs 881.00, which is an increase of Rs 147. The prices were last increased by over Rs 19 on January 1.

This was the sixth straight hike in the prices of cooking gas.

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Indian Oil is the country's largest fuel retailer which supplies LPG under brand Indane. LPG rates are revised on first of every month based on the average worldwide rate for benchmark fuel and foreign exchange rate in the preceding month. For the Budgetary year 2020, the government raised the allocation for the next fiscal year to provide subsidized fuel, in particular LPG and kerosene, by 6% to approximately Rs 40.915.21 crore.

An official of a public sector oil company said on condition of anonymity that even common man using LPG cylinder would not be spared from a price hike as the amount of actual subsidy would not cover for the increase in the GST post revision of prices.

General rule of thumb states that when global rates move up, the government provides a higher subsidy and when they come down, the subsidy is cut.

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