The war between Iran and the US has disrupted the global fuel supply chain, impacting many countries, including India. Meanwhile, the price of LPG cylinders in India is expected to rise in the coming days. According to a report by an international news agency, the central government is considering a plan to raise approximately ₹3.99 lakh crore. To achieve this, it has emerged that a proposal to impose an additional charge on consumers using LPG and natural gas (PNG/CNG) is being considered. However, no official announcement has been made by the central government in this regard yet.

According to the report, the proposal seeks to raise approximately $42 billion by imposing additional charges on consumers using LPG and natural gas. This proposal reportedly comes against the backdrop of energy security challenges facing India due to the conflict in Iran. If approved, India's fuel stockpile program could be expanded to include LPG and LNG, rather than being limited to crude oil.

How much can the price of a cylinder increase?

A fee of ₹1.29 per kg is proposed on LPG. This could increase the price of a 14.2 kg domestic cylinder by approximately ₹18. Similarly, a levy of ₹1.43 per standard cubic meter is proposed on natural gas, which could generate approximately $1 billion in annual revenue. Thus, the levy on LPG and natural gas is expected to generate approximately $1.5 billion annually. However, the method by which this levy will be collected is not yet known.

What will the government do with this money?

According to one report, the fuel storage program is expected to cost approximately $42 billion over the next 10 years. More than half of this amount will be spent on building fuel storage infrastructure, while the remaining amount will be used to build fuel stocks.