Centre to cover cost of ₹200 LPG cylinder price cut, assures Hardeep Singh Puri: Report | Mint
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Business News/ News / India/  Centre to cover cost of 200 LPG cylinder price cut, assures Hardeep Singh Puri: Report
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Centre to cover cost of ₹200 LPG cylinder price cut, assures Hardeep Singh Puri: Report

Government to bear the cost of ₹200 price decrease on cooking gas cylinders, relieving oil marketing companies of ₹7,500 crore loss.

As a gift for the women in advance of Raksha Bandhan, the Union Cabinet on Tuesday lowered by 200 rupees the price of a 14.2 kilogramme LPG cooking gas cylinder. Premium
As a gift for the women in advance of Raksha Bandhan, the Union Cabinet on Tuesday lowered by 200 rupees the price of a 14.2 kilogramme LPG cooking gas cylinder.

LPG cylinder news: Minister of Petroleum and Natural Gas, Hardeep Singh Puri stated on 30 August that the government would bear the cost of the promised 200 price decrease on household cooking gas cylinders, relieving the oil marketing companies of the impending loss of 7,500 crore.

As a gift for the women in advance of Raksha Bandhan, the Union Cabinet on Tuesday lowered by 200 rupees the price of a 14.2 kilogramme LPG cooking gas cylinder. The decision was made as criticism of the Centre for its handling of rising inflation has grown.

Puri's declaration came a day after the government announced the price cuts on domestic cooking gas cylinders, in an exclusive interaction with CNBC-TV18, stated moneycontrol in its news report.

To mitigate the impact of domestic consumer inflation, the Union Cabinet announced a price reduction on LPG on August 29. Oil marketing companies (OMCs) initially expressed apprehension about the Centre's decision, which they projected would have a financial impact of close to 7,500 crore.

According to moneycontrol news report, the oil minister highlighted that it has always been unclear who will be responsible for the financial effects of a decline in energy prices. He added that the Centre and the OMCs should work together to safeguard the average person's wealth.

Also Read: LPG price cut by 200 per cylinder in inflation fight

The oil minister complimented the Narendra Modi-led administration for adopting the much-needed price reduction for LPG cylinders and claimed that everyone in the country has applauded the Centre's most recent action. He also applauded the government's initiatives to steadily increase home LPG connections.

"Earlier, nearly 45 percent of the country's population was outside the LPG cylinder system, due to supply-chain issues and black market. In 2014, there were 14 crore domestic LPG connections, which has now gone up to 32 crore," Puri said. He also said that today, domestic cooking gas cylinders are available in any part of the country, stated moneycontrol in its news report.

A direct price reduction of 200 will help both Ujjwala and non-Ujjwala customers, shielding them from the present retail inflation.

“Puri further noted that OMCs have demonstrated a healthy performance in the first quarter of fiscal 2023, and are projected to display a positive and reassuring performance in the second quarter as well. Though they had initially taken a loss, they recovered later, supported by the Centre, said the minister. This, in turn , insulated the nation's economy as well the consumer ecosystem from every kind of macroeconomic shocks," said moneycontrol in its report.

The minister reportedly stated that India will buy oil at the most affordable price from all suppliers, according to the moneycontrol news report.

"We will buy oil from wherever we can get it as long as it is delivered to our point of importation at our ports at the lowest possible price," he noted, according to moneycontrol.

Since the West implemented sanctions as retaliation for Russia's invasion of Ukraine in 2022, India has been receiving crude oil at reduced prices from Russia, which has emerged as the nation's leading exporter of the commodity. India, which ranks third in the world for both oil imports and consumption, imports more than 80% of its oil.

Also Read: LPG cylinder prices cut by 200, 'PM Modi's gift for Raksha Bandhan', announces Centre

On Wednesday's trading session, shares of Indian Oil Corporation Ltd, Bharat Petroleum Corporation Ltd, and Hindustan Petroleum Corporation Ltd closed in red zone, down over 1% to 2.5%.

 

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Published: 30 Aug 2023, 03:56 PM IST
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