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Reliance enters cooking gas retailing

Reliance Industries has entered into cooking gas retailing market by launching a 4-kg LPG cylinder on pilot basis. Four-kg LPG cylinder has been launched in 4 districts on pilot basis. LPG consumption is growing by over 10 percent.

Currently, public sector retailers, Indian Oil, Bharat Petroleum and Hindustan Petroleum control retail LPG market, selling cooking gas in 5-kg, 14.2-kg and 19-kg cylinders. They sell 12 cylinders of 14.2-kg or 34 bottles of 5-kg per year to households on subsidized rates and any requirement above that on market price. The 19-kg cylinder is for commercial use.

Private firms are not entitled for government subsidy and they have to sell at market price. However, with the government restricting volume of subsidy as well as barring consumers earning more than Rs 10 lakh per annum from subsidized LPG, a ready-made market is now available for private oil companies.

While RIL did not disclose the price at which it is marketing the 4-kg cylinder, a 5-kg subsidized domestic LPG cylinder costs Rs 158.50 in Delhi. A 5-kg cylinder for domestic use is priced at Rs 181 while it costs Rs 252.50 for non-domestic use.

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