The Nepal Oil Corporation (NOC) has slashed the price of liquefied petroleum gas (LPG) by Rs50 per cylinder effective from Friday. With the latest revision, the cooking gas will now cost Rs1,325 per cylinder.

The NOC said that the revision has been made to relieve consumers during the upcoming festivals.

Sitaram Pokharel, chief of the distribution department at the NOC, said they have revised the price in line with the new price list of the product sent by the Indian Oil Corporation (IOC) on Thursday.

“Although prices of other petroleum products have increased, we have reduced the price of cooking gas, mainly to relieve people as the festive season is approaching,” said Pokharel.

With the adjustment, the NOC’s profit will be reduced by Rs100-120 million, said Pokharel. As of mid-August, the state-owned enterprise’s profit stood at Rs470.13 million per month.

Since adopting the automation price mechanism on September 22, 2014, the NOC has been revising the price as per the price change in the international market. Following the implementation of the auto pricing system, the corporation has cleared its dues worth Rs36 billion in just 18 months. Last time, the enterprise reduced LPG price by Rs25 per cylinder on August 2. The NOC has been making profit of Rs111.70 per cylinder from the LPG business, even after the price reduction.   Meanwhile, the NOC says the demand for cooking gas has eased in the last few months. Deepak Baral, director at the NOC, said the gas bottlers have collected purchase delivery orders for only 22,000 tonnes last month. “Although we have asked the IOC to provide 37,000 tonnes every month, gas bottlers are not taking the full import quota provided to them,” he said.

According to the bottlers, the demand has mainly dropped due to the ongoing summer season along with the hoarding made by the consumers in the aftermath of the economic blockade imposed by India. During the four-and-half-month-long blockade, gas imports had dropped notably. Over the period, Nepal imported just 4,000-10,000 tonnes of cooking gas a month, according to NOC statistics.