Domestic LPG prices could see an upward revision from August 1 as rising global crude oil prices, geopolitical tensions in the Middle East and a weaker rupee continue to increase India’s import bill for petroleum products.
India’s oil marketing companies—Indian Oil Corporation (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL)—review LPG cylinder prices on the first day of every month. The upcoming revision comes at a time when Brent crude is trading above $87 per barrel, significantly higher than the levels seen a month ago.
More than 60% of Indian households rely on LPG as their primary cooking fuel, making any increase in cylinder prices likely to affect household budgets. Since the outbreak of the US-Iran conflict on February 28, domestic LPG cylinder prices have reportedly increased by 10.43%, while commercial LPG cylinder rates have risen by 19.42%.
At present, a 14.2-kg domestic LPG cylinder is priced at Rs 942 in New Delhi, while a 19-kg commercial cylinder costs Rs 2,930. In Bengaluru, the same cylinders are priced at Rs 944.50 and Rs 3,021, respectively.
Industry experts say the sharp rise in crude oil prices is being driven more by geopolitical uncertainty than by demand. Concerns over supply disruptions, coupled with fresh sanctions proposals targeting Russia’s energy sector, have added further volatility to global energy markets.
The situation has become more complex after the US Senate initiated legislation that could impose stricter sanctions on Russia’s energy exports and authorise tariffs of up to 100% on countries importing Russian oil and gas. If implemented, the move could have wider implications for major buyers, including India.
Brent crude briefly climbed to around $120 per barrel before easing, but it continues to trade well above its early July level of nearly $72 per barrel. The sustained increase in international oil prices has heightened expectations that oil marketing companies may revise LPG prices upward in the August review.
Although crude oil prices are among the most important factors influencing LPG and fuel pricing, they are not the only consideration. Exchange rates, import costs, government policy and global LPG prices also play a role in determining retail cylinder rates.
With international energy markets remaining volatile, consumers and businesses will be closely watching the August 1 price revision to see whether higher global costs translate into another increase in domestic LPG prices.