Commercial LPG rises to ₹2,810 per 19-kg cylinder in Delhi while ATF climbs to ₹137 per litre; household LPG, petrol and diesel prices remain unchanged
Oil marketing companies have raised the prices of commercial LPG and aviation turbine fuel (ATF) from October 1, adding to operating costs for restaurants, hotels, airlines and other businesses even as household cooking-gas prices remain unchanged.
The price of a 19-kg commercial LPG cylinder in Delhi has increased by ₹62.50 to ₹2,810, from ₹2,747.50 previously. Aviation turbine fuel, meanwhile, has become costlier by ₹16 per litre, taking the price for domestic airlines to ₹137 per litre from ₹121.
The revisions come against a backdrop of volatile international energy prices and follow sharp fluctuations in commercial LPG rates and repeated changes in ATF prices during the past few months.
Commercial LPG Prices Rise Ahead of the Festive Season
The October increase represents a rise of around 2.3 per cent in the Delhi price of a 19-kg commercial LPG cylinder.
Commercial LPG had already increased by ₹9.50 per cylinder in September. That followed two consecutive monthly reductions of ₹183.50 in July and ₹192 in August.
The recent price movement has been particularly volatile. Between February and June, the price of a 19-kg commercial LPG cylinder increased by ₹1,373, rising from ₹1,740.50 to ₹3,113.50. Rates subsequently declined sharply before beginning to rise again.
The latest increase is therefore significant for businesses that use LPG as an important cooking or heating fuel, including restaurants, hotels, caterers and some small and medium-sized commercial establishments.
Domestic LPG Price Remains Unchanged
Household consumers have been insulated from the October commercial LPG increase.
The price of a 14.2-kg domestic LPG cylinder remains unchanged at ₹942 in Delhi. Petrol and diesel prices have also remained unchanged this month.
The distinction between commercial and domestic LPG means the immediate impact of the October revision is concentrated on businesses rather than household cooking-gas users.
However, businesses facing higher fuel costs could eventually factor part of the increase into prices of food, accommodation and other services, depending on their ability to absorb the additional expense.
ATF Price Jumps ₹16 Per Litre
The aviation sector is facing a sharper increase in fuel costs.
ATF prices have risen by ₹16 per litre, or roughly 13.2 per cent, taking the rate for domestic airlines to ₹137 per litre from ₹121.
The October increase follows a ₹6.28-per-litre, or 5.46 per cent, increase in September and a ₹5-per-litre increase in August. ATF can account for as much as 40 per cent of an airline's operating costs, making fuel-price movements an important determinant of airline profitability.
For airlines operating with relatively thin margins, a sustained increase in jet-fuel costs can put pressure on profitability unless the additional expense is offset through higher fares, improved aircraft utilisation, stronger passenger yields or savings elsewhere.
Why ATF Prices Matter for Airlines
Fuel is generally one of the largest variable expenses for airlines. Consequently, sharp increases in ATF can affect the economics of both domestic and international operations.
The impact, however, will vary between airlines depending on their fleet composition, fuel-efficiency levels, hedging policies, route mix and ability to pass higher costs on to passengers.
The timing of the October increase is also important because the aviation industry enters a period of increased travel demand around the festive and holiday season.
Higher passenger volumes can provide some offset to rising fuel costs, but the extent will depend on ticket yields and competitive pricing.
International Energy Prices Remain a Key Driver
ATF and commercial LPG prices are revised on the first day of each month, with international benchmark prices and currency movements influencing the domestic pricing environment. Rates can also vary across states because of local taxes such as VAT.
The latest increases come amid continuing volatility in global energy markets linked to geopolitical tensions and disruptions in international supply chains.
For India, which imports a substantial share of its crude oil requirements, higher global energy prices can influence the cost of petroleum products, the trade balance, inflation and corporate margins.
Government Cuts Export Windfall Tax
Alongside the monthly fuel-price changes, the Centre has reduced the export levy on diesel and ATF for the fortnight beginning October 1.
The Special Additional Excise Duty (SAED) on diesel exports has been reduced to ₹16 per litre from ₹20 per litre. The levy on ATF exports has been cut to ₹10.50 per litre from ₹15 per litre.
The export duty on petrol remains unchanged at ₹0.50 per litre. The revised rates will apply through October 15, after which they can be reviewed again.
The government reviews these export levies periodically in response to movements in international crude and refined-product prices.
What Is the Windfall Tax?
The export levy was introduced as part of the government's response to the sharp rise in international energy prices and concerns over domestic availability of petroleum products.
The framework allows the government to adjust export levies as global market conditions change. The rates have been revised several times during 2026.
The reduction in the diesel and ATF export levies therefore represents a recalibration of the tax burden on refiners and exporters rather than a reduction in the retail price of fuel sold domestically.
Importantly, the October export-tax change does not directly reduce the domestic price of petrol or diesel.
Impact on Oil Marketing Companies
The combination of higher domestic product prices and lower export levies creates a mixed operating environment for oil marketing companies and refiners.
Higher international benchmark prices can increase the cost of crude and petroleum products, while domestic pricing decisions determine how much of that increase can be passed through.
At the same time, lower export levies can improve the economics of exporting diesel and ATF when international realisations are attractive.
For companies with significant refining and export exposure, margins will therefore depend on the interaction between crude prices, product cracks, domestic pricing, taxes and foreign-exchange movements.
Restaurants, Hotels and Commercial Users
The commercial LPG increase has a more direct impact on businesses than households.
Restaurants, hotels, catering companies and other establishments that rely heavily on LPG could face higher energy expenses from October. Businesses with limited pricing power may have to absorb part of the increase, while others could pass some of the additional cost on to customers.
The impact will vary depending on LPG consumption, operating margins and the availability of alternative energy sources.
For the broader services sector, the increase comes at a time when businesses are preparing for higher seasonal demand during the festive period.
Potential Impact on Inflation
Domestic LPG prices have been kept unchanged, which limits the immediate direct impact on household inflation from the October revision.
However, commercial LPG and ATF are important inputs for different parts of the economy. Higher commercial cooking-fuel costs can feed into hospitality and food-service prices, while higher aviation fuel costs can influence airline fares and the cost of air cargo.
The eventual inflationary impact will depend on the duration of the energy-price increase, the extent to which companies absorb higher costs and movements in other commodity prices.
Energy Market Outlook
The October fuel-price revisions highlight the continuing sensitivity of India's energy economy to international crude and refined-product markets.
Commercial LPG has recovered from its sharp July-August decline, while ATF has now recorded another substantial monthly increase. At the same time, the government has reduced export levies on diesel and ATF, indicating that petroleum taxation continues to be adjusted as global market conditions evolve.
For investors, the key variables to monitor will be international crude prices, refinery margins, the rupee-dollar exchange rate, domestic fuel pricing, export-tax revisions and the sustainability of demand from airlines and commercial establishments.
A prolonged period of elevated crude and aviation-fuel prices could keep pressure on airline profitability and raise costs across fuel-intensive sectors. Conversely, a moderation in global energy prices could ease the pressure on transportation, hospitality and other businesses.
The next fortnightly review of petroleum-product export levies and the subsequent monthly LPG and ATF price revision will provide further indications of how the government and oil marketing companies are responding to changing global energy conditions.