Indian Oil hikes auto LPG price by 7.6% for 2nd time since Dec
New Delhi   06-Jan-2010
The country's largest oil marketing company, IndianOil has hiked the price of Auto Gas, the LPG marketed for use in automobiles, for the third month in a row. The price of auto LPG used in automobiles as an alternative to diesel and petrol has been raised 7.67 per cent to Rs 31.30, beginning January 1. In December 2009, the Auto Gas price was hiked to Rs 29.07 a litre from Rs 26.83 a litre in November. Mr. Sarthak Behuria, Chairman, IndianOil, attributed price rise to a spurt global prices. In the overseas markets, natural gas price rose to $ 5.572 per mBtu during the month, a 14.93 per cent raise over $4.84 per mBtu in November 2009. Natural gas traded at around $5.792 per mBtu at Nymex on Tuesday. Over the past few years, there has been a rise in the number of passenger vehicles that use auto LPG. Three automobile firms, Hyundai, Maruti Suzuki and General Motors India, sell vehicles that can run on LPG. "Price rise of auto LPG is primarily determined by two factors; first, global gas prices are showing an upward movement and secondly, it is the only product sold in Indian market without subsidies. A company can take the opportunity to raise price of auto LPG because it's still priced lower than petrol and a customer, would prefer to run his vehicle on LPG to cut cost," said Mr. Deepak Mahurkar, Associate Director (Oil & Gas practice) at Price Water House Coopers, India. The fuel sales in India rose 3.7 per cent in November to 11.32 million tonnes from a year earlier.