Economy

Watch | A steep rise in LPG prices

The price of auto liquefied petroleum gas (LPG) and non-subsidised LPG cylinders have seen a surge. Cylinders weighing 14.2 kg has increased by ₹144.50 to ₹149. This is the steepest since January 2014. The subsidy to domestic users have almost doubled.

It has been increased from ₹153.86 to ₹291.48 Domestic users are entitled to get a total of 12 cylinders each year. The rise is due to the spurt in the benchmark global rates of fuel. Domestic prices of LPG are determined from the import parity price (IPP). IPP is the price that is fixed based on the cost of importing the commodity into a location. It includes free-on-board price, ocean freight, customs duties, port dues and the like.

Also read | Why have LPG prices seen a sharp rise?

Saudi Aramco's LPG price acts as a benchmark for IPP. This price is then converted into rupees before local costs. The government resets the LPG prices every month based on IPP and prevailing dollar rates. As a result of this, household budgets are bound to go up. The price hike has worried autorickshaw drivers across the country. 

Printable version | Apr 17, 2021 11:29:18 PM | https://www.thehindu.com/business/Economy/a-steep-rise-in-lpg-prices/article30840016.ece

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