Government likely to scrap monthly LPG price hike

New Delhi: The government likely to scrap the monthly increase in cooking gas prices, media reports said on Thursday.

After hiking cooking gas LPG price by Rs 76.5 in 19 installments in 17 months, national oil companies skipped the monthly revision in rates last month ahead of elections in Gujarat.

State-owned Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) have been since July last year raising price of LPG on 1st of every month with a view to eliminating government subsidies on the fuel by 2018.

The price of subsidised LPG was last raised by Rs 4.50 per cylinder on November 1 to Rs 495.69, according to a price notification issued by state-owned firms.

The government last year had asked state-run oil firms to raise prices every month to eliminate all the subsidies by March 2018. Since the implementation of the policy of monthly increases from July last year, subsidised LPG rates have gone up by Rs 76.51 per cylinder. A 14.2-kg LPG cylinder was priced at Rs 419.18 in June 2016.

Every household is entitled to 12 cylinders of 14.2-kg each at subsidised rates in a year. Any requirement beyond that is to be purchased at market price.

Initially, the hike in LPG rate was Rs 2 per month which was raised to Rs 3 from May this year. The November 1 hike in the LPG price was the sixth since the May 30 order of the oil ministry to raise rates by Rs 4 per cylinder every month.