LPG distributors' commission hike: OMCs back interim increase, ministry approval awaited

New Delhi: Amid speculation of strike by LPG distributors over their demands, including a commission hike, the All India HP Gas Distributors Association (AIHPGDA), Federation of LPG Distributors of India (FLDI), and All India LPG Distributors Federation (AILDF) engaged in a dialogue with the three Oil Marketing Companies (OMCs).

During a bipartite meeting on October 21, 2026, the directors and senior officials of Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL) agreed to jointly recommend an interim increase in the commission, as per a statement by AIHPGDA.

According to the statement posted by AIHPGDA on X, the revised proposals have already been sent to the Ministry of Petroleum and Natural Gas, and approval is awaited.

The core issues discussed during the meeting included the financial distress faced by LPG distributors, operational difficulties, and the forced upliftment of Non-Domestic Non-Exempted (NDNE) LPG, Free Trade LPG, and Non-Fuel Products despite lower demand.

Operational costs are rising at the same time as commercial pressure is increasing as a result of reduced refill sales, restrictions on new LPG connections, and unsold commercial stock affecting working capital.

The distributors' bodies also raised concerns regarding changes to indents without the distributor's consent. The requests placed by these distributors with the OMCs to obtain LPG cylinders for supply to customers must not be altered without their approval. For this, distributors have demanded recorded consent for commercial indents.

Regarding the restriction on new connections, the managements stated that the matter had been reviewed at the highest level and that work was underway. The operational hurdles have emerged as a result of geopolitical tensions, leading to financial distress for distributors.

Distributors also sought written standard operating procedures (SOPs), digital audit trails, and independent grievance redressal mechanisms to improve transparency and accountability.

The meeting also discussed LPG-PNG safeguards, commercial business practices, reconciliation of OMC records with invoices and GSTR-1, supply-chain accountability, and consumer safety.

“OMC Management appreciated the dedication of distributors and staff during the recent crisis, while indicating that complete operational normalisation would take time,” it added.

The association further stated that the distributors had requested meeting minutes and an action matrix specifying responsibilities, deadlines, and matters requiring ministry intervention.

“AILDF, FLDI and AIHPGDA will continue their work and follow up firmly and constructively. Our unity remains essential for securing a financially viable, respected and operationally secure distributor network,” it said.

Separately, the Federation of LPG Distributors of India (FLDI), in an X post, said that it was “Grateful to the Petroleum Secretary for facilitating the constructive 21 October meeting with OMC Directors (Marketing), bringing LPG trade concerns directly before senior leadership.”

(With inputs from ANI)