LPG price reduction: solely benefits Ujjwala customers; no harm to OMCs

In order to process applications related to the Pradhan Mantri Ujjwala Yojana (PMUY), the Central Government has announced it will offer 75 lakh new LPG connections gratis, bringing the total number of PMUY beneficiaries to 10.35 crore.

For those who qualify for the Ujjwala programme, an LPG cylinder would cost Rs 400, which includes Rs 200 in existing subsidies in addition to the price reduction.

According to CNBC-Awaaz, a day after the Centre announced a Rs 200 price cut on 14 kilogramme liquefied petroleum gas (LPG) cylinders, it has been made clear that the most recent compensation or subsidies will not be extended to oil marketing firms (OMCs).

Estimating the cost impact of the price reduction would be challenging, per sources, given the greater headroom space on LPG now enjoyed by OMCs. Before making a final decision on the price changes, the Centre will allegedly assess the situation in light of consumption trends and global prices.

Additionally, sources verified that the 75 lakh new Ujjwala connections are the only recipients of the most recent subsidy announcement. In order to process applications related to the Pradhan Mantri Ujjwala Yojana (PMUY), which will bring the total number of PMUY beneficiaries to 10.35 crore, the Central Government has announced it will offer 75 lakh additional gas connections free of charge.

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