Lok Sabha Question No. 5520 (UNSTARRED), answered on 2025-04-03
Subject: Reduction in Prices of Petroleum Products
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Shri Rahul Kaswan

## LOK SABHA UNSTARRED QUESTION NO. 5520 TO BE ANSWERED ON 03 APRIL, 2025

## Reduction in Prices of Petroleum Products

†5520. Shri Rahul Kaswan:

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũी

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

- (a) whether the prices of petroleum products are increasing day by day in the country, if so, the details thereof and if not, the reasons therefor along with the steps being taken to stabilize these prices;
- (b) the new measures taken by the Government to reduce the rising prices of petroleum products including  petrol  and  diesel  in  view  of  the  sanctions  imposed  on  the  various  Oil  Producing Companies (OPCs) globally; and
- (c) whether any high-level review has been conducted regarding the increase and decrease in the prices of petrol, diesel, crude oil and domestic LPG in the country, if so, the details thereof along with the conclusions drawn and the measures taken by the Government in this regard?

## ANSWER

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũालय मŐ राǛ मंũी ( ŵी सुरे श गोपी )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI SURESH GOPI)

(a) to (c): Prices  of  petrol  and  diesel  are  market  determined  and  Public  Sector  Oil Marketing Companies (OMCs) take appropriate decision on pricing of petrol and diesel.

Government of India is closely monitoring  global  energy  markets  as  well  as  potential  energy supply disruptions as a fall-out of the evolving geopolitical situation. To ensure security of crude supplies and to mitigate the risk of dependence on crude oil from single region, Public Sector Undertakings  (PSUs)  have  diversified  their  petroleum  import  basket  and  are  procuring  crude from countries located at various geographical locations.

Government also took several other steps to insulate common citizens from high international prices, which included diversifying the crude import basket, invoking the provisions of Universal Service Obligation to ensure availability of petrol & diesel in domestic market, increasing the blending of ethanol in petrol, etc.

Domestically,  Petrol  and  Diesel  prices  have  come  down  to  Rs.  94.77  and  Rs.  87.67  per  litre respectively  (Delhi  prices) as  a result  of  various  steps  taken  by  Government  and  PSU  OMCs, Central Excise duty was reduced by the Central Government by a total of Rs. 13/litre and Rs. 16/litre  on  petrol  and  diesel  respectively  in  two  tranches  in  November  2021  and  May  2022, which was fully passed on to consumers. Some State Governments also reduced state VAT rates to provide relief to citizens. In March, 2024, OMCs reduced the retail prices of petrol and diesel by Rs. 2 per litre each.

PSU OMCs have recently carried out an intra-state freight rationalisation.  This  has  benefitted consumers located at remote areas, far from Petroleum Oil & Lubricants (POL) Depots in the form of reduced Petrol and Diesel prices in remote parts within the states. This initiative has also reduced  the  difference  between  the  maximum  and  minimum  retail  prices  of  Petrol  or  Diesel within a state.

India has been the only major economy in the world where the prices of petrol and diesel have come down in recent  years.  Changes  in  prices  of  petrol  and  diesel  in  some  major  economies between November 2021 and January 2025 are as under:

|               | %age Change in Prices between Nov-21 and Jan-25   | %age Change in Prices between Nov-21 and Jan-25   |
|---------------|---------------------------------------------------|---------------------------------------------------|
| Country       | Petrol                                            | Diesel                                            |
| India (Delhi) | -13.60%                                           | -10.92%                                           |
| France        | 14.21%                                            | 15.08%                                            |
| Germany       | 7.87%                                             | 12.43%                                            |
| Italy         | 8.65%                                             | 11.39%                                            |
| Spain         | 8.67%                                             | 12.93%                                            |
| UK            | 0.08%                                             | 2.61%                                             |
| Canada        | 10.52%                                            | 23.05%                                            |
| USA           | 4.83%                                             | 12.86%                                            |

Source: Petroleum Planning and Analysis Cell (PPAC)

Changes in prices of petrol and diesel in some neighboring economies between November 2021 and January 2025

|               | %age Change in Prices between Nov-21 and Jan-25   | %age Change in Prices between Nov-21 and Jan-25   |
|---------------|---------------------------------------------------|---------------------------------------------------|
| Country       | Petrol                                            | Diesel                                            |
| India (Delhi) | -13.60%                                           | -10.92%                                           |
| Pakistan      | 29.76%                                            | 34.97%                                            |
| Bangladesh    | 13.94%                                            | 30.82%                                            |
| Sri Lanka     | 53.98%                                            | 101.59%                                           |
| Nepal         | 22.02%                                            | 31.32%                                            |

Source: Petroleum Planning and Analysis Cell (PPAC)

India imports about 60% of the domestic LPG consumed. Price of LPG in the country is linked to its price in the international market. While the average Saudi CP (international benchmark for LPG pricing) rose by 63% (from US$ 385/MT in July 2023 to US$ 629/MT in February 2025), the  effective  price  for  Pradhan  Mantri  Ujjwala  Yojana (PMUY) consumers for domestic  LPG was reduced by 44% (from Rs. 903 in August 2023 to Rs. 503 in February 2025).

To  make  LPG  more  affordable  to  PMUY  consumers  and  ensure  sustained  usage  of  LPG  by them, in May 2022 Government started a targeted subsidy of Rs.200/- per 14.2 kg cylinder for up to  12  refills  per  annum  (and  proportionately  pro-rated  for  5  Kg  connections)  to  the  PMUY consumers. LPG prices were reduced by Rs. 200 in August, 2023 and Rs. 100 in March, 2024 for all  domestic LPG consumers.  In October 2023, Government increased the targeted subsidy to Rs.300 per 14.2 kg cylinder for up to 12 refills per annum (and proportionately pro-rated for 5 Kg connections).  All  LPG  consumers  receive  domestic  LPG  at  Rs.  803  per  14.2  Kg  cylinder (Delhi price). There is currently no proposal under consideration of Government for increasing the amount of subsidy.

Globally, PMUY is the biggest program of its kind that provides Domestic LPG to more than 10.33 crore poor households at an effective price of just about Rs. 35/Kg. Further, the effective price of domestic LPG cylinder in neighbouring countries as on 01.01.2025 is as below:

| Country   | Domestic LPG (Rs./14.2 kg.cyl.)   |
|-----------|-----------------------------------|
| India     | 503.00*                           |
| Pakistan  | 1094.83                           |
| Sri Lanka | 1231.53                           |
| Nepal     | 1206.65                           |

Source: Petroleum Planning and Analysis Cell (PPAC)

*Effective cost to PMUY beneficiaries in Delhi, effective price is Rs. 803 for non-PMUY consumers

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