New Consumer Friendly LPG Cylinders to Hit Markets

by Santosh Kumar Agarwal for Alarm Bells June 30, 2008

A consumer friendly translucent and lightweight LPG cylinder is likely to hit the market any time next year. These cylinders being translucent, the level of liquid petroleum in the cylinder would be clearly visible from outside, making it easier to maintain a refill stock. This would make the cylinders a premium choice of the housewives.

The cylinders would be manufactured from fiberglass and polymer combination. This would make them much lighter than the present weight of about 15kg (vacant cylinder). Apart from being lightweight, these would be corrosion resistant and more durable.

However, the cylinders are likely to be marketed in the ‘Premium’ segment without any subsidy, meaning the price of these cylinders would be much higher than the current market price. The cylinders are likely to be made available in free market for ex-stock sales and are basically meant for affluent section of the society.

Presently as per government data, oil companies subsidise the LPG cylinder @ Rs.300/- per cylinder. Burdened with this ever-increasing subsidy, the three Public Sector oil giants, IOC, BPCL and HPCL have come up with this innovative idea, in line with their experience in selling ‘Premium Petrol’ and ‘Premium Diesel’ which are already fetching higher prices in the market.

As per Oil PSU sources, the premiun sector fuel oils- which on an average sell at a premium of Rs.3/- per litre- have captured a market share of over 30%, which is expected to go up to 40% this year. Likewise, the ‘Premium LPG’, is also expected to get a substantial market share, reducing the subsidy burden. The PSUs are now planning to float global tenders to initially purchase these cylinders, for marketing tests at select areas in the country.