The price of a 14.2-kg domestic LPG cylinder was hiked due to geopolitical disruptions to fuel supply. This increase has drawn attention to the essential role that gas cylinders play in various sectors, particularly in hospitality.
Recent Developments
Oil marketing companies have recently increased the prices of non-subsidised domestic LPG gas cylinders by 60 rupees across metropolitan cities in India. The price for a 14.2 kilogram gas cylinder has now risen from 853 rupees to 913 rupees in Delhi. New rates for LPG cylinders are 912.50 rupees in Mumbai, 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 raised concerns among various stakeholders, particularly in the hospitality sector.
Impact on the Hospitality Sector
An acute shortage of commercial LPG cylinders is disrupting the hospitality sector in major cities like Mumbai, Bengaluru, and Chennai. Reports indicate that at least 20 percent of the hotels and restaurants in Mumbai had to shut down temporarily due to the LPG cylinder shortage. The situation has prompted reactions from industry associations.
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 sentiment reflects the growing frustration within the industry as they grapple with supply issues.
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 has invoked the Essential Commodities Act to ensure the supply of natural gas, emphasizing the need for priority allocation to maintain operational availability.
Officials have stated that the supply of natural gas must be treated as a 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 keenly watching the situation, as the hospitality sector continues to face challenges amid these price hikes and supply disruptions.
