Commercial LPG, Jet Fuel, and Fuel Prices Slashed As Global Pressures Ease

New Delhi: Rising fuel prices in India are expected to come down soon as oil marketing companies (OMCs) on Wednesday started reducing commercial LPG and jet fuel or aviation turbine fuel (ATF) prices for domestic carriers due to significant improvements in the supply side. Domestic LPG rates remained unchanged due to the easing of conflicts in West Asia.

With the decrease in both commercial LPG and ATF prices, food bills are expected to be cheaper in all food and beverage venues and air travel in the country in the coming days. Giving major relief to restaurants, hotels and similar small business houses, OMCs have significantly reduced the price of 19 kg commercial LPG cylinders by Rs 183.50 with effect from Wednesday.

After the discount, the retail price of LPG in Delhi is Rs 2,930 per cylinder. Additionally, OMCs have also reduced the price of a 5kg free trade LPG (FTL) cylinder by Rs 13. After the revision, the retail price of 5 kg FTL cylinder in Delhi now stands at Rs 808.50. Similarly, ATF prices for domestic carriers have been reduced by Rs 5 to Rs 110 per litre, from Rs 115 per litre, industry sources said on Wednesday.

As for commercial LPG prices, this is the first price cut for 19 kg cylinders this year, while domestic prices of 14.2 kg LPG cylinders remain unchanged at Rs 942. The price drop is attributed to the ease in global crude oil prices following the extension of the ceasefire between the United States and Iran, affecting important shipping routes.

For jet fuel prices, the government last month launched an ATF price stabilization scheme under which participating airlines can purchase jet fuel at a fixed price of Rs 115 per liter for up to three years. Airlines that do not choose this plan will continue to pay prevailing market rates.

Under the mechanism, if the reference ATF prices rise above the base rate of Rs 86.32 per litre, which is equivalent to a retail price of Rs 115 per litre, after airport charges, oil company margins and applicable taxes, the government will provide interest-free advances to oil marketing companies to make up the difference.

Meanwhile, sources also said that India’s largest private fuel retailer, Nayara Energy, on Wednesday announced a significant discount on petrol and diesel prices across its network of over 7,000 fuel stations in the country. “Across the country’s retail network, petrol prices have been reduced by Rs 5 per liter and diesel by Rs 3 per litre, making it the first fuel retailer to reduce pump prices in over two years as easing tensions in the Middle East have led to lower international crude oil prices,” the source said.

The move follows a decline in global crude oil prices as hostilities in West Asia eased and concerns about supply disruptions eased as a key sea route reopened. Nayara was among the first retailers to increase fuel prices after the outbreak of the Iran conflict. On March 26, petrol prices were increased by Rs 5 per liter and diesel prices were increased by Rs 3 per litre.