Commercial LPG price hike is back on the agenda for businesses, with fuel costs rising again even as international airlines see some respite on jet fuel.
From 1 June, the price of a 19-kg commercial LPG cylinder in Delhi has risen by ₹42 to ₹3,113.5 per unit, adding to the operating costs of hotels, restaurants and catering services that rely heavily on bottled gas. The smaller 5-kg Free Trade LPG (FTL) cylinder has also become more expensive, up ₹11 to ₹821.5 in the capital, a move that particularly affects migrant workers and low-income urban households who depend on these mini cylinders because they lack regular address proof.
Domestic consumers have been spared this round of increases, with the 14.2-kg household LPG cylinder price left unchanged at ₹913 in Delhi. Even so, for commercial users the latest commercial LPG price hike is the fourth increase since late February, when the conflict in West Asia began disrupting global energy supplies and pushing up import-dependent fuel costs.
Oil marketing companies have attributed the commercial LPG price hike to sustained volatility in international LPG benchmarks linked to tensions in West Asia and concerns over supply security. Since March, commercial LPG rates have climbed sharply, including a steep ₹993 jump for the 19-kg cylinder on 1 May and earlier hikes of ₹195.5 on 1 April and ₹115 on 7 March.
For users of the 5-kg FTL cylinder, this is the third increase over the same period, following a ₹51 rise in April and a much sharper ₹261 jump in May. Industry analysts say the cumulative effect of the commercial LPG price hike is squeezing margins across the hospitality and small business sector, with some operators already warning of higher menu prices and service charges.
In contrast to the commercial LPG price hike, aviation turbine fuel (ATF) prices for international flights have been cut by more than 27%, dropping by about 400 dollars per kilolitre to around 1,100 dollars per kilolitre in the latest revision. This rollback comes after a sharp run-up in recent months and is aimed at easing cost pressures on overseas operations as global oil benchmarks soften.
ATF prices for domestic scheduled carriers, however, remain unchanged for a second consecutive month at roughly ₹1.05 lakh per kilolitre in Delhi, after a large increase announced in April. Airlines serving the domestic market therefore get little immediate benefit from the jet fuel correction, even as ground-facing businesses struggle with yet another commercial LPG price hike.
Economists caution that the latest commercial LPG price hike could seep into food and services inflation as eateries, canteens and small manufacturers pass on higher input costs to consumers over the coming weeks. With domestic LPG prices frozen for now and ATF partly adjusted only for international operations, policymakers face a delicate balance between protecting households, supporting industry and preserving the financial health of fuel retailers amid the prolonged West Asia conflict.
In that sense, the commercial LPG price hike underlines how vulnerable India's energy basket remains to global shocks, even when targeted relief such as the ATF reduction offers temporary comfort to one part of the economy.