The government on Friday instructed state-run oil companies to immediately resume issuing new domestic LPG connections which was suspended since April by firms like IOC following liquidity crunch.

The newly-appointed Petroleum Secretary R S Pandey called a meeting of officials from three retailers Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum to review the accumulated wait list of LPG consumers in the country.

Pandey instructed the companies to immediately resume issuing new LPG connections and wipe-out the wait list of nearly 2.5 lakh consumers within the next two months.

"The matter was reviewed sales in the Ministry today and it is hereby clarified that there would be no restrictions in releasing LPG connections by Oil Marketing Companies (OMCs). These OMCs would continue to enrol fresh applications and release the connections," a ministry statement said.

IOC Chairman Sarthak Behuria had on July 30 stated that the company had no money to buy new equipment including LPG cylinders and so it had temporarily suspended issuing fresh connections.

The action forced by Rs 338 per cylinder loss the company made on sales of domestic LPG, had led to a wait list of two lakh consumers at the company's dealers throughout the country.

The Ministry official said that BPCL had a smaller waiting list while HPCL had almost nil.
 
Behuria said IOC had been enrolling new customers but had not been issuing the connections due to constraints.

IOC lost Rs 33 crore per day on sale of domestic LPG as the government had not allowed it to raise retail prices in line with rise in costs.