LPG price cut by Rs 100

Cooking gas cylinders will be cheaper by Rs. 100.50 fromtoday, the Indian Oil Corporation has declared, providing major relief tohouseholds across the country. With this, the unsubsidized price of eachdomestic LPG cylinder will be Rs. 637 instead of Rs. 737.50.

According to a press release issued by Indian Oil, thedecision to cut rates was taken in view of softening LPG (liquefied petroleumgas) prices in the international market and a favourable dollar-rupee exchangerate.

As domestic LPG prices are subsidized by the government, theeffective price has come down to Rs. 494.35 per cylinder with this raterevision. The balance amount of Rs. 142.65 per cylinder "would be borne assubsidy" by the central government and transferred to the consumer's bankaccount after the purchase of a refill, the release said.

The cut comes exactly a month after LPG saw a price hike of3.65 per cent with effect from June 1. According to Indian Oil, that amountedto an increase of Rs. 25 per cylinder as compared to the previous month.

At present, the government subsidizes 12 cylinders of 14.2kg each per household in a year. For any additional purchases, the consumer hasto bear the market price. The extent of subsidy varies from month to month, dependingon changes in the average international benchmark LPG prices and foreignexchange rates.