OMC under-recoveries head for ₹40,000 crore by May-end as govt holds LPG, fuel prices steady

State-run oil marketing companies (OMCs) are incurring steep under-recoveries on both LPG and petrol and diesel as the government intervened to keep retail prices steady amid sharp rise in energy costs triggered by supply disruptions, the Ministry of Petroleum and Natural Gas said on Wednesday.

In a statement, the ministry said OMCs are currently facing an under-recovery of about ₹380 per domestic LPG cylinder, with cumulative losses projected to reach around ₹40,484 crore by end-May if prices remain unchanged.

The government has, however, kept prices of domestic cooking gas unchanged to protect households.

A 14.2-kg domestic LPG cylinder continues to cost ₹913, while beneficiaries under the Pradhan Mantri Ujjwala Yojana (PMUY) pay ₹613 per cylinder.

The ministry said the prices have been kept unchanged despite a sharp spike in international LPG prices, with the Saudi Contract Price (CP) jumping 44% from $542 per tonne in March to $780 per tonne in April.

In the previous year, total LPG-related losses of about ₹60,000 crore were split equally between oil PSUs and the Centre to insulate consumers from global price volatility, the government said.

The impact of elevated global crude prices is also being felt in petrol and diesel.

OMCs are incurring under-recoveries of ₹24.40 per litre on petrol and ₹104.99 per litre on diesel at the retail selling price level as of April 1.

Retail prices of regular petrol and diesel in Delhi continue at ₹94.77 per litre and ₹87.67 per litre, respectively.

“The recent Rs 2/litre revision applies only to premium petrol variants — XP95, Power95, Speed — high-octane performance products, whose prices are revised on fortnightly basis and whose sales by volume are 2% and 5% of total volume,” the ministry said. “They are purchased by motorists, at a premium, by choice.”

The price of a 19-kg commercial LPG cylinder was raised by ₹195.50 in Delhi and ₹218 in Kolkata with effect from April 1.

Following the revision, a 19-kg cylinder will cost ₹2,078.50 in the national capital.

This is the second consecutive monthly increase in commercial LPG rates.

Commercial LPG accounts for less than 10% of total domestic consumption and is deregulated.

India’s domestic LPG rates remain among the lowest globally, the ministry said, citing higher prices in neighbouring countries such as Pakistan, Sri Lanka and Nepal.