How is LPG Price Calculated in India

Gas prices in India are revised by Oil Marketing Companies (OMCs) every month. Crude prices in the international markets and the value of the rupee against the dollar determine gas rates in India.

Updated On - 05 Sep 2025

Based on the Import Parity Price (IPP), gas prices are calculated in the country. The prices of gas are different in every state because of local taxes.

LPG Price Calculation – Formula 

  1. Based on the IPP, LPG prices are calculated in India. 
  2. Any calculations done under IPP are based on the prices in the global market. 
  3. IPP is used in the country as more than 50% of the consumption is via imports. 
  4. The formula that is used to calculate LPG prices is revised every month. 
  5. Several factors such as insurance costs, port charges, customs duties, ocean freight, and Free on Board (FOB) rates are considered when determining LPG prices. 
  1. The price of Saudi Aramcos LPG is used for IPP calculation. 
  2. Crude oil prices in the international markets affect LPG rates in India. 
  3. Goods and Service Tax (GST), dealer commissions, marketing costs, bottling costs, margin, and freight costs are some of the inland prices that are included. 
  4. Following the inclusion of these prices, the final cost is determined for LPG cylinders (non-subsidised). 

Under the Pradhan Mantri Ujjwala Yojana scheme, women who belong to poor families are provided LPG cylinders for free.

Factors that Determine LPG Prices 

Some of the factors that determine LPG prices in India are mentioned below: 

  1. Crude oil prices in the international markets. 
  2. Local taxes. 
  3. Custom duties. 
  1. Bottling costs. 
  2. Marketing costs. 
  3. The value of the rupee against the dollar. 
  4. Dealer commissions. 
  5. Port charges. 
  1. Insurance costs. 

FAQs on LPG Price Calculation in India

  • Will LPG rates be the same across all the cities in India?

    No, LPG rates will not be the same across all the cities in India due to local taxes.

  • Do OMCs revise the prices of gas cylinders every month?

    Yes, OMCs revise the prices of gas cylinders every month.

  • Can I apply for a new Indian Oil gas cylinder online?

    Yes, you can visit the official website of Indian Oil to apply for a new gas cylinder.

  • Can I book a gas cylinder via Amazon Pay?

    Yes, you can book a gas cylinder via the Amazon mobile app.

  • Can I book a gas cylinder via Paytm?

    Yes, you can book a gas cylinder by visiting the official website of Paytm or on the app. 

  • Is it possible to book a gas cylinder on the Umang mobile app?

    Yes, you can book a gas cylinder on the Umang mobile app.

  • Can I visit the distributor’s office to apply for a new gas connection?

    Yes, you can visit the distributor’s office to apply for a new gas connection.

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