The Hindu Business Line : LPG supply shortage eased substantially, says Aiyar

THE Petroleum Minister, Mr Mani Shankar Aiyar, said on Monday that the pledge of substantially ending physical shortage of liquefied petroleum gas (LPG) for domestic purposes has been fulfilled.

He has said that both the Ministry and the oil companies with a view to taking immediate corrective action are monitoring the availability of LPG on a day-to-day basis. The Minister also underlined the necessity for LPG distributors and State governments to act in concert in order to cap, reduce and eliminate diversion of subsidised domestic LPG for unauthorised and dangerous use in vehicles.

In a statement issued here, the Minister said, "Since its emergence over three-and-a-half decades ago as a household fuel, LPG has very rapidly emerged as the most preferred domestic fuel among Indian housewives — particularly in the urban and semi-urban parts of the country.

"To add to their comfort, domestic LPG is being distributed by the OMCs at heavily subsidised rates, thus insulating them to a very large extent from the steep rise in international market prices. Moreover, most of the burden of subsidy, running to over Rs 10,000 crore a year, is borne by the public sector oil companies.

"Apart from ensuring increased domestic production of LPG through the refineries and fractionation units spread across the country, any shortfall in LPG requirements was met through imports," the Minister said, adding that "unfortunately a few unforeseen events in the recent months have led to the build-up of a backlog in parts of the country."

These involved political disturbances in Manipur, floods in Maharashtra, Tamil Nadu and Andhra Pradesh and the derailing of rail wagons carrying domestic LPG, Mr Aiyar said.

The most serious disruption in recent weeks has been caused by the shut-down of a private sector refinery for carrying out repairs, he said, adding that the shut-down was notified at a time when a sudden shortage of LPG developed in international markets owing to the hit that refineries in the US took on account of Hurricanes Katrina and Rita, now continuing with Wilma. "This complicated our import arrangements," the Minister said.

In these difficult circumstances the oil companies are doing their best to ensure that additional LPG cargoes are tied up and till these cargoes arrive, inventories are drawn down to ensure availability at distributors' level, he said.

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