The price of commercial LPG cylinders used by hotels, restaurants and other companies has increased by $$42 per 19kg cylinder on Monday, news agency PTI reported, citing industry sources.
After the review, the price of 19 kg commercial LPG cylinder in Delhi has increased to $3,113.50 from $3,071.50 previously.
While there has been no change in the prices of domestic gas cylinders used in home kitchens. The price of a local liquefied gas cylinder with a capacity of 14.2 kg remained unchanged at $913.
The latest amendment affects commercial consumers, while households will continue to pay the current price for cooking gas.
There has been no change in the prices of domestic cooking gas used in home kitchens. The price of a 14.2 kg domestic LPG cylinder remained unchanged at $913 in Delhi.
Why are fuel prices rising?
The recent increase in commercial LPG prices comes against the backdrop of rising global energy costs resulting from the ongoing war between the United States and Iran. The conflict has raised concerns about the disruption of supplies of crude oil and liquefied petroleum gas from the Middle East, especially through the Strait of Hormuz, one of the world’s most important energy shipping routes.
India imports more than 85 percent of its crude oil needs, making domestic fuel prices vulnerable to developments in global energy markets. Any threat to supplies from the Gulf region usually leads to an increase in global crude oil prices, which ultimately affects the cost of petroleum products and LPG in the country.
Commercial LPG prices have risen in recent months
The commercial LPG sector has witnessed sharp price fluctuations in recent months. Monday’s increase follows a series of sharp rises that have led to a significant increase in operating costs for restaurants, hotels, catering and other businesses that rely heavily on LPG.
In May, oil marketing companies raised the price of commercial LNG cylinders by nearly 100%. $1000, with the Delhi rate raised to $3,071.50 per cylinder. Before that, prices increased by $195.5 in April and by $114.5 in March. The cumulative increase over the past few months has resulted in a significant increase in fuel expenses for commercial users.
Industry experts say commercial LPG prices are closely linked to global energy prices and are revised more frequently than domestic cooking gas prices, which are often influenced by government policy considerations and subsidy decisions.
Petrol and diesel prices are also under pressure
The pressure from global energy prices was also reflected in retail fuel prices. Petrol and diesel prices have witnessed multiple upward revisions in recent weeks as crude oil prices rose following escalation of tensions in West Asia.
Petrol and diesel prices rose several times during May, with the cumulative rise amounting to approx $5 per liter in major cities, including Delhi. These increases are due to higher global crude oil prices and concerns about supply disruptions resulting from the US-Iran conflict.
High fuel prices have broader implications for the economy because it increases transportation and logistics costs, which can ultimately fuel retail inflation. Companies that rely on commercial LPG have already warned that continued increases in fuel costs may force them to review prices for goods and services.
No change in local LPG prices
Despite the increase in commercial LPG prices, domestic consumers were spared any immediate impact. The price of a local liquefied gas cylinder with a capacity of 14.2 kg remained unchanged at $913.
Home cooking gas prices were last revised in March, when prices were increased by 100%. $60 per cylinder. The difference between commercial and domestic LPG prices reflects the government’s efforts to protect households from frequent fluctuations in fuel prices while allowing commercial consumers to make market-related reviews.
