The Government sanctioned Rs 30,000 crore for public sector oil companies like Indian Oil, Bharat Petroleum, and Hindustan Petroleum in FY 2025-26 to supply LPG at subsidized rates. The retail price of a 14.2 Kg domestic LPG cylinder in Delhi currently stands at Rs 913.
Under the Pradhan Mantri Ujjwala Yojana (PMUY), poor consumers receive a targeted subsidy of Rs 300 per cylinder, allowing them to purchase 14.2 Kg LPG cylinders at an effective price of Rs 613 in Delhi. To boost domestic LPG availability, the Ministry has instructed oil refineries to prioritize LPG production by channeling C3 and C4 streams exclusively to public sector oil companies under the Essential Commodities Act.
The government, through the Indian Strategic Petroleum Reserve Limited (ISPRL), has set up strategic petroleum reserves with a total capacity of 5.33 Million Metric Tonnes (MMT) of crude oil. This initiative aims to mitigate supply chain disruptions arising from events like the Iran war. Minister Suresh Gopi highlighted that petrol and diesel prices are market-driven, with public sector oil companies making pricing decisions. Fiscal interventions are made as needed to adjust the tax structure on petroleum products to ease consumer burdens.
In recent years, the Central government reduced Central Excise duty by Rs 13 per litre on petrol and Rs 16 per litre on diesel in two phases, benefiting consumers. While OMCs lowered petrol and diesel prices by Rs 2 per litre each in March 2024, the subsequent excise duty hike in April 2025 was not passed on to consumers, according to the minister.
