Lok Sabha Question No. 3763 (UNSTARRED), answered on 2023-03-23
Subject: Increasing Price of Kerosene and Gas
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Omprakash Bhupalsinh alias Pawan Rajenimbalkar, Sanjay Haribhau Jadhav, Vinayak Bhaurao Raut

## LOK SABHA

## UNSTARRED QUESTION NO. 3763 TO BE ANSWERED ON 23 MARCH, 2023

## Increasing Price of Kerosene and Gas

†3763. SHRI OMPRAKASH BHUPALSINH ALIAS PAWAN RAJENIMBALKAR: SHRI SANJAY JADHAV: SHRI VINAYAK BHAURAO RAUT:

## पेोलयम और ाक ृतक गैस मंी

Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

- (a) the details of the increase in the prices of kerosene, petrol and LPG gas in the country since 2004;
- (b) the reasons for steep rise in the prices of above mentioned commodities in the country;
- (c)  the  immediate  steps  taken  by  the  Government  to  check  the  sky  rocketing  prices  of  these commodities;
- (d)  the  difference  between  the  prices  of  the  above  mentioned  commodities  at  present  as compared to the year 2004 and the reasons therefor;
- (e)  whether  the  Government  would  increase/  decrease  the  quota  of  kerosene  for  the  States especially Maharashtra; and
- (f) if so, the details thereof and if not, the reasons therefor?

## ANSWER

## पेोलयम और ाक ृतक गैस मंालय म राय मंी ( ी रामेश ् वर तेल )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI RAMESWAR TELI)

(a) to (f): Prices of petrol have been market-determined with effect from 26.06.2010. Since then, the Public Sector Oil Marketing Companies (OMCs) take appropriate decision on pricing of  petrol.  Prices  of  petrol  have  not  been  increased  by  public  sector  Oil  Marketing  Companies (OMCs) since 6 th April 2022.

Central  Government  reduced  Central  Excise  duty  by  a  total  of  Rs.13/  litre  on  petrol  in  two tranches in November 2021 and May 2022. The excise duty reduction was fully passed on to consumers.    The  measure  was  aimed  to  give  a  further  fillip  to  the  economy  and  to  boost consumption  and  keep  inflation  low,  thus  helping  the  poor  and  middle  classes.  Subsequently, many States/UTs have also reduced VAT rates on petrol.

Government makes allocation of Public Distribution System (PDS) Kerosene for cooking and lighting purpose only. Effective 1 March, 2020, the retail selling price of PDS Kerosene is being maintained at NIL under-recovery level on pan India basis.

Government  vide  order  dated  21st August  2012,  has  empowered  States/  UTs  to  draw  an allocation of one month's quota of PDS Kerosene at Non-Subsidized rates during each financial year for special needs such as natural calamities, religious functions, fisheries, various yatras etc. Annual allocation of Non-Subsidised PDS Kerosene is done by Petroleum Planning & Analysis Cell  (PPAC)  in  the  beginning  of  each  financial  year. States/UTs  may  seek  further  additional allocation after exhausting available quota. The  allocation of Kerosene  for  the state of Maharashtra is 16752 Kilolitres for the year 2022-23.

India  imports  more  than  60%  of  its  domestic  LPG  consumption.  Government  continues  to modulate the effective price of domestic LPG. While the Saudi Contract Prices (CP), on which domestic LPG prices are based, rose by 235 % from 236 $/MT in April 2020 to 790 $/MT in February 2023, retail selling price of domestic LPG has increased only by 89.7 % from Rs. 581.5 in May 2020 to Rs.1103 in March 2023 and effective cost for PMUY rose only by 55.2 % during the same period. Public Sector Oil Marketing Companies have suffered huge losses on sale of domestic  LPG.  To  compensate  these  losses,  the  Government  has  recently  paid  a  one-time compensation of Rs. 22000 crore to OMCs.

Under the Direct Benefit Transfer for LPG (DBTL) scheme, subsidy as admissible, is deposited in  the  account  of  eligible  beneficiaries.  W.e.f.  21.05.2022,  Government  has  started  a  targeted subsidy  of  Rs.  200  per  14.2  Kg  cylinder  for  Pradhan  Mantri  Ujjwala  Yojana  (PMUY) beneficiaries for upto 12 refills for year 2022-23.

The details of prices of petrol, domestic LPG and Kerosene as on 01.04.2004 and 01.03.2023 are given below:

| Prices as on   |   Petrol (Rs. per litre) |   Domestic LPG (Rs./14.2 Kg cylinder) |   PDS Kerosene (at Mumbai) (Rs. per litre) |
|----------------|--------------------------|---------------------------------------|--------------------------------------------|
| 01.04.2004     |                    33.71 |                                 241.6 |                                       9.26 |
| 01.03.2023     |                    96.72 |                                1103   |                                      72.09 |

Source: Petroleum Planning and Analysis Cell

The difference in prices of petroleum products including Petrol, LPG and Kerosene at different points of  time  is  contingent  upon  various  factors  viz.  international  product  prices,  exchange  rate,  tax structure, inland freight, dealer commission and other cost elements.