New Delhi, Sep 1 (TIWN) The government has completely eliminated the need to provide subsidy on domestic cooking gas as the global fall in oil prices and frequent rise in LPG gas cylinder price has brought the price of the common man's fuel closer to market rates.

 Since June, the Modi government has hiked (subsidised) PDS kerosene prices by 25 paise per litre every month.

All consumers have to pay the market price of a 14.2 kg cylinder upfront. The government transfers the subsidy directly into the account of eligible consumers. The subsidy is the difference between market and subsidised price of cooking gas.

Global crude oil prices are on a free fall since middle of March bringing do wn crude prices from a level of $35 a barrel to below $20 for sometime and n ow to around $25 barrel. Along with crude fall, product prices, including LPG prices, have also fallen drastically pushing oil companies to cut price of non-subsidised domestic LPG cylinder by a record Rs 162.50 to Rs 581.50 a cylinder in Delhi from May 1.

"At current market price of cooking gas, government may not need to p ay any subsidy to households. Only marginal subsidy may be required for Ujja wala customers. If the price trend continues, government could completely el iminate oil subsidy bill in FY21 that could come handy for making additional spending for other Covid-19 related relief measures," said an official of a country's largest public sector oil refiner and retailer as king not to be named.