Cabinet approves Rs 22,000-Crore one-time compensation for OMCs on LPG

Mangalore Today News Network / News18

New Delhi, Oct 12, 2022: The Union Cabinet on Wednesday approved a one-time compensation of Rs 22,000 crore for oil marketing companies (OMCs) — IOCL, BPCL and HPCL — on liquefied petroleum gas (LPG) to help them tide over losses as a result of under-recoveries. The LPG prices have not been revised as per the price hikes globally.

 

The Rs 22,000 crore grant will reflect in supplementary demands for grants.

Briefing reporters on the decision taken by the Union Cabinet, Union Minister Anurag Thakur said that globally, LPG prices have risen as high as 300 per cent. In this comparison, price hikes in India are much lesser. He said the oil marketing companies incurred total expenses of Rs 22,000 crore between June 2020 and June 2022.

India imports about 50 per cent of its LPG requirement. In the past two years, the import benchmark Saudi contract price has increased over 300 per cent

On October 1, oil marketing companies cut the 19-kg commercial LPG cylinder price by Rs 25.5. The cylinder now costs Rs 1,859 in Delhi. However, there was no change in domestic LPG prices and it continues to be sold at Rs 1,053 per cylinder in Delhi.