Commercial LPG Cylinder Price Hike Ahead of the Festive Season
Public sector oil marketing companies have increased the price of a 19-kg commercial LPG cylinder by about 15-15.5 rupees. In Kerala, the retail price reached 1,602.5 rupees in Kochi, 1,623.5 rupees in Thiruvananthapuram, and 1,634.5 rupees in Kollam. This uptick comes after a period where commercial cylinders had seen monthly price cuts, signaling a shift in the pricing pattern as the festive season approaches.
Background: Monthly Revisions in 2024
Industry observers note that commercial LPG cylinder prices were trimmed in several months earlier this year: April by 43 rupees, May by 15, June by 25, July by 57.5, August by 34.5, and September by 51.5 rupees. These reductions reflect the oil marketing companies’ ongoing adjustments tied to movements in international crude oil prices and other market factors. The latest increase, however, reverses that downward trajectory and places higher costs on commercial users such as hotels, restaurants, and small eateries.
Domestic/Household Cylinders: No Change Yet
In contrast, the price of the standard 14.2-kg household cylinder has remained unchanged in this revision cycle. In Kochi, the household cylinder stands at 860 rupees; Kollam reports 861.5 rupees; Thiruvananthapuram 862 rupees. The domestic cylinder market has followed a different pricing path than its commercial counterpart, even as both markets respond to broader crude price dynamics.
Historical Context and Relief Measures
The last notable domestic cylinder price adjustment occurred on March 8, 2024. As part of a broader relief package and ahead of national elections, Prime Minister Narendra Modi announced a 100-rupee reduction for women as a token of support on Women’s Day. Earlier, on April 7, 2024, households saw a 50-rupee increase in domestic cylinder prices, a move that offset some of the earlier discounts. The domestic segment thus experienced a mix of reductions and increases, with the net effect depending on the month and city.
Overall, approximately 90% of LPG is used domestically for cooking in India. In Kerala, household consumption remains high, with about one crore LPG customers reportedly relying on gas for daily meals. Under the PM Ujjwala Yojana, roughly three lakh people are beneficiaries in the state. This distribution underscores how shifts in domestic pricing—though not as volatile as commercial rates—still influence household budgets in homes across Kerala.
Impact on Businesses and Households
The latest rise in the commercial LPG cylinder price is a direct hit for the hospitality sector—hotels, restaurants, and small retail outlets that operate on larger cylinders. These entities face higher operating costs during a period typically marked by increased consumer spending and festival-related demand. In contrast, household consumers have benefited in the past from price-relief measures and have largely watched domestic prices stabilize in the latest revision, even as the national pricing cycle continues to respond to crude price movements.
Oil marketing companies revise prices monthly, calibrating them to crude oil trends and currency movements. For Kerala’s diverse consumer base, the net effect of these adjustments is felt differently: businesses contend with higher input costs, while many households navigate a tighter budget at a time of seasonal spending. The state’s pricing pattern also interacts with logistics and regional demand, particularly during the festive season when cooking needs spike.
What to Watch Next
Industry observers expect the trend to continue depending on international crude dynamics, refinery margins, and the ongoing policy environment. While domestic cylinders have shown relative stability in the latest cycle, commercial prices may remain sensitive to global oil prices and monthly revisions by oil marketing companies. Consumers—both households and small businesses—will likely monitor announcements closely as the festive period unfolds and demand for LPG intensifies.
