LPG rate slashed by Rs 113 as crude oil falls

Price of non-subsidised cooking gas (LPG) was cut by a steep Rs 113 per cylinder and that of jet fuel by 4.1 per cent on Monday as crude oil prices in the international market dropped to a five-year low with Brent crude falling below $68 before eventually settling at $70.07. A 14.2-kg cylinder of nonsubsidised LPG will now cost Rs 752, down from Rs 865, in Delhi, oil companies announced.

This is the fifth straight reduction in rates of non-subsidised or market priced LPG, which customers buy after exhausting their quota of 12 cylinders at subsidised rates, since August.

In five monthly reduction, non-domestic LPG rates have been slashed by Rs 170.5 per cylinder bringing the price at three-year lows. On similar lines, the price of jet fuel in Delhi was cut by Rs 2,594.93 per kilolitre, or 4.1 per cent, to Rs  59,943.

This is the fifth straight monthly reduction in rates. This reduction follows a steep 7.3-per cent, or Rs  4,987.7 per kilolitre, cut in prices on November 1. Since August, ATF prices have been cut by 14.5 per cent and rates have dipped below Rs 60,000 per kilolitre for the first time in three years.

Crude oil prices have been falling steadily for five months giving respite to countries like India that import close to 80 per cent of their crude requirement. Petroleum ministry figures show that the price of the Indian basket of crude imports, comprising cheap high sulphur Dubai varieties and sweet crude of the Brent quality, came down to $70.29 per barrel on November 28 and is expected to come down further.

Losses on sale of subsidised LPG and kerosene have dropped by 21 per cent to Rs 148 crore per day. State-run oil firms were losing Rs 188 crore a day during November.

The losses have come down to Rs  25.69 on sale of every litre of kerosene through the Public Distribution System (PDS) and Rs 279.91 per 14.2 kg of domestic cooking gas, according to an official statement.

These are lower than Rs 27.60 a litre loss oil firms were incurring on sale through PDS in November and Rs 393.50 per LPG cylinder.