The government on Thursday raised the price of subsidised LPG by Rs 2 per cylinder, bringing the cost of a 14.2-kg cylinder to Rs 425 in Delhi, PTI reported. This is the third such price hike since July – it was last increased by Rs 1.93 in August and by Rs 1.98 in July.

The Centre has opted to raise the rate in phases. In its bid to eliminate subsidies on cooking gas, the government has chosen to follow the United Progressive Alliance's method of deregulating diesel prices by imposing 50 paise hikes every month. However, the price of jet fuel was slashed by 3.8%.

With this hike, the government has also permitted state-owned oil companies to hike the rate of kerosene by 25 paise a litre each month for 10 months. Oil firms cut the rates of non-subsidised LPG, which can be purchased once the quota of 12 for subsidised LPG is exhausted, bringing the price down to Rs 466.

The oil price and foreign exchange rate prevailing in the preceding month determines the revision of jet and cooking fuel prices on the 1st of every month.