LPG cylinders
LPG cylinders

Cabinet approves Rs 22,000 crore as one-time grant to PSU OMCs for losses in domestic LPG

New Delhi, October 12, 2022

The Union Cabinet, chaired by Prime Minister Narendra Modi, today approved a proposal of the Ministry of Petroleum & Natural Gas to give a one-time grant amounting to Rs. 22,000 crore to three public sector oil marketing companies (OMCs) to partly cover their losses in supplying domestic LPG.

The grant will be distributed among Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL), an official press release said.

"The approval will help the PSU OMCs to continue their commitment to the Atmanirbhar Bharat Abhiyaan, ensuring unhindered domestic LPG supplies and also supporting the procurement of Make in India products," it said.

The release said domestic LPG cylinders are supplied at regulated prices to consumers by the public sector OMCs.

"During the period from June 2020 to June 2022, the international prices of LPG increased by around 300%. However, to insulate consumers from fluctuations in international LPG prices, the cost increase was not fully passed on to consumers of domestic LPG. Accordingly, domestic LPG prices have raised by only 72% during this period. This has led to significant losses for these OMCs," it said.

"Despite these losses, the three PSU OMCs have ensured continuous supplies of this essential cooking fuel in the country," the release added.

NNN

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