LPG to cost Rs 3.50 more per cylinder

Domestic cooking gas (LPG) rates may soon go up by almost Rs 3.50 per cylinder in case the government accepts a recommendation for increasing the commission paid to dealers by over 9 per cent.

The Petroleum Planning and Analysis Cell, the fuel pricing arm of the Oil Ministry, has recommended raising the commission paid to dealers by Rs 3.46 per 14.2-kg cylinder to Rs 40.71, official sources said.

The increase in commission - which is normally passed on to consumers - is expected within a couple of weeks.

LPG in Delhi costs Rs 410.50 per 14.2-kg cylinder. The last revision in cooking gas prices happened in October last year when because of an increase in dealers commission the rates were raised from Rs 399 per cylinder to Rs 410.50.

PPAC also recommended raising dealers commission on 5-kg LPG cylinder by Rs 1.73 to Rs 20.36 per bottle.

A 5-kg LPG cylinder costs Rs 353 in Delhi currently.

PPAC said the annual revision in dealers' commission is being proposed keeping in view the increase in expenses like salary and wages.

It said, however, that no revision in the additional distributor commission of 75 paisa paid on sale of non-subsidised sale of 14.2-kg cylinder was required for the present. The 75 paisa is over and above the commission of Rs 37.25.

Non-subsidised LPG is sold at market price of Rs 1,004 per cylinder in Delhi.

LPG dealers' commission was last revised on October 7, 2012 when it was raised from Rs 25.83 per 14.2-kg cylinder to Rs 37.25. The same for 5-kg cylinder was hiked from Rs 13.30 to Rs 18.63 per bottle.

The commission has more than doubled in past six years with almost yearly increases. The commission was raised from Rs 16.71 per 14.2-kg LPG cylinder to Rs 19.05 on March 1, 2007; to Rs 20.54 on June 4, 2008; to Rs 21.94 on June 30, 2009 and to Rs 25.83 per bottle on July 1, 2011.