The economic burden of providing domestic cooking gas has increased rapidly in recent times. The delivery cost of a standard 14.2 kg LPG cylinder has now crossed ₹1,600. Despite the huge jump in fuel prices internationally, customers are still paying a very low price. This results in a loss (under-recovery) of about ₹700 per cylinder, the burden of which is borne by the government and public sector oil marketing companies. The gap between market-linked costs and retail prices has widened amid continued volatility in global energy markets due to supply disruptions at the Strait of Hormuz – a key route for energy shipments from the Middle East.
**How much has the price increased in the international market?**
According to the Ministry of Petroleum and Natural Gas, international LPG prices have increased in the last few months, leading to a significant increase in India’s import bill. In February, the Saudi Aramco contract price (CP) for a 50:50 propane-butane blend was US$542.50 per tonne. Due to export bottlenecks at the Strait of Hormuz, this benchmark rose to US$775 per tonne in April and further increased to US$790 per tonne in June. The ministry said that the prices of both the main components of LPG have increased significantly during this period.
**Lowest LPG prices in India**
The ministry said losses on domestic LPG sales have increased sharply last year due to the continuous rise in global prices. The overall under-recovery (difference between cost and selling price) on domestic LPG has increased from ₹41,338 crore in the last financial year to ₹60,000 crore by the end of financial year 2025-26. The Union Cabinet has approved compensation of ₹30,000 crore to help oil marketing companies.
Despite the recent increase of ₹29 in cylinder prices, the cost of domestic LPG is much lower than the actual procurement and supply cost. From Sunday, the price of 14.2 kg domestic LPG cylinder in Delhi has been fixed at ₹942. The ministry said this price is much lower than the market-related cost.
