On May 1, the price of a 19 kg commercial LPG cylinder in Delhi jumped by ₹993 to ₹3,071.50. Petrol and diesel prices stayed frozen, with oil companies absorbing large losses. The cost of the war is being split in ways most customers never see.
If your favourite dosa got more expensive in May, the reason may be a cylinder. On May 1, oil companies raised the price of a 19 kg commercial LPG cylinder in Delhi by ₹993 in a single monthly revision, to ₹3,071.50. Commercial cylinders, used by restaurants, hotels, canteens and small workshops, follow international gas prices closely. With Gulf supplies disrupted and Brent trading above $100, the increase was steep.
Two prices for the same gas
Household LPG and commercial LPG are the same fuel, but they are priced very differently. Household cylinders are politically sensitive and often subsidised, so their prices move slowly and modestly. Commercial cylinders carry close to the full market cost. When gas prices surge, the government protects kitchens at home and lets businesses absorb the shock. Restaurants then pass part of it on to customers in higher menu prices, which economists call pass-through.
The petrol pump puzzle
Petrol and diesel prices, meanwhile, did not move. The government restructured fuel excise duties, and the oil marketing companies, which are mostly state-owned, kept retail prices frozen. Rating agency ICRA estimated they were losing about ₹14 on every litre of petrol and ₹18 on every litre of diesel. Those losses do not vanish. They show up in the companies’ profits, in their share prices and eventually, through lower dividends or government support, in the public finances.
Someone always pays for an oil shock. The only question is whether you see the bill.
Freezing pump prices protects households from an immediate jolt and keeps headline inflation lower than it would otherwise be. It also delays the adjustment. If oil stays high for long, the frozen prices will eventually have to move, and the longer they wait, the bigger the jump.
Sources: Indian Oil Corporation price notifications, May 1, 2026; ICRA estimates.
- A 19 kg commercial LPG cylinder in Delhi rose by ₹993 to ₹3,071.50 on May 1.
- Commercial cylinders follow global prices closely. Household cylinders are shielded.
- Retail petrol and diesel prices were left unchanged despite oil above $100.
- Oil marketing companies were estimated to be losing about ₹14 a litre on petrol and ₹18 on diesel.
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