The price of a 14.2-kg domestic LPG cylinder was hiked due to geopolitical disruptions to fuel supply. This increase has raised concerns among consumers and businesses alike, particularly in the hospitality sector.

Recent Developments

Oil marketing companies have increased the prices of non-subsidised domestic LPG gas cylinders by 60 rupees across metropolitan cities in India. In Delhi, the price for a 14.2 kilogram gas cylinder has been increased from 853 rupees to 913 rupees. The new rates for LPG cylinders in Mumbai will be 912.50 rupees, 939 rupees in Kolkata, and 928.50 rupees in Chennai.

Additionally, rates of commercial LPG gas cylinders have been increased by 115 rupees. This price hike has led to an acute shortage of commercial LPG cylinders, disrupting the hospitality sector in major cities such as Mumbai, Bengaluru, and Chennai.

Impact on the Hospitality Sector

At least 20 percent of the hotels and restaurants in Mumbai had to shut down temporarily due to the LPG cylinder shortage. The AHAR – Indian Hotels and Restaurants Association expressed concerns, stating, “Despite being a basic operational requirement for restaurants and hotels, commercial cylinders are becoming increasingly difficult to obtain through proper channels.” This situation has raised alarms about the sustainability of operations in the hospitality industry.

Government Response

In response to the crisis, the Indian government has increased the LPG booking period from 21 days to 25 days to curb hoarding. Furthermore, the Government of India invoked the Essential Commodities Act to ensure the supply of natural gas, emphasizing that “the supply of natural gas must be treated as priority allocation and shall be maintained subject to operational availability to one hundred percent of their average past six-month average gas consumption.”

Looking Ahead

Details remain unconfirmed regarding the exact impact of ongoing geopolitical conflicts on future gas cylinder prices. Observers are closely monitoring the situation as it develops, particularly in relation to the hospitality sector’s recovery and the overall market stability.

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