LPG prices see a sharp rise with respite for domestic consumers.
The government on Friday announced the sharpest-ever hike in the prices of commercial LPG and 5kg gas cylinders, against the backdrop of the surging energy costs precipitated by the West Asia conflict.
The price of commercial LPG, which is used in hotels and restaurants, was hiked by ₹993 to a record high of ₹3,071.50 per 19kg cylinder.
Aviation fuel prices for domestic airlines, however, were left unchanged, providing stability to local carriers and sparing flyers any immediate cost increase.
Also, the price of bulk diesel, used by industries like telecom signal towers, was increased from ₹137 per litre to over ₹149 a litre.
The ATF (Aviation Turbine Fuel) for domestic airlines will continue to be priced at ₹1,04,927.18 per kl as state-owned oil companies have decided to absorb the rise in global fuel prices to protect airlines and consumers.
On April 1, when the rates for international carriers were more than doubled to $1,435.31 per kl, oil companies had increased jet fuel prices for domestic airlines by only 25 per cent, adopting a calibrated approach.
The decisions on ATF by state-owned oil companies will come as a relief to domestic carriers like Air India, IndiGo and SpiceJet, which had in the run-up to the scheduled monthly revision warned of the sector being under “extreme stress” and cited “non-operatable conditions”.
Announcing the decisions, market leader Indian Oil Corporation (IOC) said the retail prices of petrol, diesel and household domestic LPG had not been changed, fully insulating domestic consumers from the recent increase in international fuel
prices.
Global oil prices have shot up almost 50 per cent after the war in West Asia disrupted energy supply chains.
International crude oil prices this week climbed to a four-year high of $126 per barrel before cooling slightly, but remained above $110 a barrel as ship transits through the Strait of Hormuz stayed restricted and US and Iranian leaders traded barbs amid stalled peace talks.
Union minister of state for petroleum and natural gas Suresh Gopi defended the hike in commercial LPG cylinder refill prices, saying global energy rates also needed to be taken into consideration.
Opposition leader Rahul Gandhi posted on X: “I told you so — the heat of inflation would come after the elections. Today, commercial gas cylinders are ₹993 more expensive. The biggest increase in a single day. This is the election bill. From February till now: ₹1,380 increase — a whopping 81% jump in just 3 months. Tea stalls, dhabas, hotels, bakeries, sweet shops — the burden on everyone’s kitchen has increased. And this will affect your plate too. First strike on gas, next strike on petrol-diesel.”
Stakeholders reaction to the price rise
The Karnataka State Hotels Association on Saturday urged the government to immediately reduce the GST on 19 kg commercial LPG cylinders from 18 per cent to 5 per cent.
“If immediate corrective measures are not taken, businesses will have no option but to pass on the increased costs to consumers, making eating out more expensive and affecting overall demand,” he said.
Lower taxation would provide immediate relief to the industry, help stabilise prices, and protect both businesses and consumers from further financial strain, it said, urging the government to immediately reduce the GST on 19 kg commercial LPG cylinders from 18 per cent to 5 per cent.
Beverages are set to get costlier by about 25%, while food items are likely to rise by at least 20% across small and mid-scale eateries, hoteliers confirmed.
Prices of a cup of coffee and tea are expected to go to around ₹25 while other food items at small and mid-scale eateries may see an increase of at least ₹15. Hotel association members said larger portion items, like meals, could see a sharper hike of ₹25–₹30.
These rises are surely going to affect the eating habits of people and it won’t take long to reflect in the descending footfall of eateries.
