OMCs' LPG Under-Recovery Increases to ₹62,000 Crore in August 2026

In August 2026, Indian oil marketing companies (OMCs) faced a rise in LPG under-recovery, reaching ₹62,000 crore, up from ₹59,000 crore in July 2026, as per NDTVprofit news report.  

This increase occurred despite government compensation efforts aimed at keeping domestic LPG prices affordable. 

Government Compensation and Under-Recovery 

As per news report, the government has been providing compensation to OMCs to mitigate the financial burden of LPG under-recovery. For FY 2025-26 and FY 2026-27, a total of ₹30,000 crore was allocated, following ₹22,000 crore in FY 2022-23.  

Despite these measures, under-recovery surged, highlighting the challenges faced by OMCs in maintaining affordable LPG prices. 

Mandatory Aadhaar Biometric Authentication 

To address issues of diversion and duplicate connections, the government announced mandatory Aadhaar Biometric Authentication for subsidised LPG refills starting October 1, 2026.  

This move aims to ensure that subsidies reach genuine consumers and prevent misuse of domestic LPG cylinders for commercial purposes. 

Read More: Commerce Ministry Proposes ₹23,000 Crore RoDTEP Outlay for FY27, Seeks Five-Year Extension! 

Impact of Global Energy Prices 

The rise in LPG under-recovery is partly attributed to elevated global energy prices, exacerbated by tensions in West Asia and disruptions in the Strait of Hormuz.  

These factors have put pressure on the economics of subsidised domestic cooking gas, affecting the cost structure for OMCs. 

Conclusion 

In August 2026, OMCs' LPG under-recovery increased to ₹62,000 crore from ₹59,000 crore in July. Despite government compensation of ₹30,000 crore for FY 2025-26 and FY 2026-27, challenges persist due to global energy price pressures and subsidy management. 

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