Non-subsidised LPG or market-priced cooking gas prices werecut by a record Rs 162.50 per cylinder on Friday, in line with the slump inbenchmark international rates.
This is the third straight monthly reduction in rates ofnon-subsidised LPG, which users who have given up subsidy buy. Also, this isthe gas that domestic household consumers buy after exhausting their quota of12 cylinders of 14.2 kg each at subsidised prices.
The outbreak of coronavirus and the lockdowns imposed bynations to curb its spread has evaporated demand for oil, sending internationaloil prices crashing.
Benchmark Brent crude oil last month dropped to a two-decadelow of USD 15.98 a barrel, but has rebounded since to USD 26.43 a barrel onFriday.
Non-subsidised LPG now costs Rs 581.50 per 14.2-kg cylinderin Delhi, down from Rs 744 till Thursday, according to a price notificationissued by state-owned oil firms.
This is the steepest reduction in non-subsidised cooking gasprices ever. It beats Rs 150.5 per cylinder cut effected in January 2019.
Also, this is the third straight monthly reduction in priceon the back of falling international rates. The cut comes on the back of Rs61.50 per cylinder reduction in April and Rs 53 cut in March.
In three reductions, the price of non-subsidised cooking gashas been cut by Rs 277 per 14.2-kg cylinder. It more than negates the massive Rs144.5 per cylinder hike in rates introduced in February.
State-owned oil marketing companies revise the price ofcooking gas on the first day of every month based on average of benchmark fuelin the international market and foreign exchange rate.
Cooking gas is available only at market price across thecountry. Eligible users, however, get a subsidy in their bank accounts forbuying LPG cylinders at below-market rates.
In Mumbai, non-subsidised cooking gas price was reduced toRs 579 per cylinder from Rs 714.50.
Domestic LPG users are entitled to buy 12 bottles of 14.2 kgeach at subsidised rates in a year.
The price of 19-kg LPG cylinders, used by commercialestablishment, has been cut to Rs 1,029.50 from Rs 1,285, the notificationsaid.