Domestic gas cylinder likely to become expensive, government is going to make important changes

Tezzbuzz Desk- There is a possibility of change in the mathematics of subsidy on domestic gas cylinders (LPG) in the country. Government oil companies have recently signed the first long-term contract for the annual supply of LPG from America, which will be effective next year till 2026. This accounts for about 10 percent of India’s annual LPG imports.

Till last year, LPG subsidy was decided on the basis of Saudi contract price (CP), which is the standard for supplies from West Asia. But now the government and oil companies are also considering including the American Standard Price and the logistics cost of trans-Atlantic shipment in the formula.

According to experts, the logistics cost of LPG coming from America is four times more than that from Saudi. This means that US LPG will be economical for India only if there is enough discount in its price to cover the logistics costs.

If American supply becomes expensive, the government can cut LPG subsidy. This will have a direct impact on the common people and crores of customers covered under the Ujjwala scheme.

According to IOCL data, the price of domestic gas cylinder in Delhi is Rs 853 with subsidy, while the price of commercial cylinder is Rs 1,580.50. In the last change, the price of domestic cylinder was increased by Rs 50 on April 8, 2025. Under the Ujjwala scheme, a subsidy of Rs 300 is given to every user. By December 2025, the number of beneficiaries of this scheme is 10.35 crore, while the total number of LPG users in the country is around 33 crore.