Domestic gas (LPG) prices are likely to rise next week. Because the under recovery on the fuel widened to over Rs 100 per cylinder. Sources said the decision to increase the price of gas cylinders would depend on the government's permission. The price of LPG is reviewed every 15 days. As a result, new rates will be announced on November 1 before Diwali. If the government allows the rate hike, it will be the fifth consecutive increase in gas cylinder rates. These include gas for domestic use and subsidized gas for cooking and heating purposes. It also includes non-subsidized and industrial use gas cylinders.
LPG rates were last hiked by Rs 15 per cylinder on October 6, taking the total increase in rates since July to Rs 90 per 14.2-kg cylinder. State-owned oil companies have to bear the rising cost of gas. It is not allowed to be combined with other charges. The government has not yet announced a subsidy to bridge this gap. As a result, the under-recovery loss in LPG sales to these companies has been more than Rs 100 per cylinder. These prices have risen sharply in the international market.
Saudi LPG prices rose 60 percent to 800 dollar a tonne this month. Brent crude is at 85.42 dollar per barrel. LPG is still under control. As a result, companies are not allowed to raise rates yet, so they have to bear the loss. The government subsidizes them in return, the sources said.