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In cities like Delhi and Mumbai, the prices of CNG and PNG (piped cooking gas) may increase by 10-11 per cent in October. This has been estimated in a report by ICICI Securities. It has been said in the report that the gas prices fixed by the government are going to increase by about 76 percent, which will also have an impact on the prices of CNG and PNG.
Natural gas prices are reviewed every 6 months
The government uses the rates of gas surplus countries. The government reviews the prices of natural gas every six months for the fields allotted on nomination basis to companies such as state-owned Oil and Natural Gas Corporation (ONGC). The next review is due on October 1.
The brokerage company said that from October 1, 2021 to March 31, 2022, the APM or administered rate will increase to $3.15 per unit (MMTTU). It is currently $1.79 per unit. Apart from this, the gas rate from deep water areas like KG-D6 field of Reliance Industries and BP Plc will go up to $7.4 per mmBtu. Natural gas is a raw material which is converted into CNG for use in vehicles and PNG for use in cooking.
APM nonin s prices Growth challenge for CGD companies
The report says, “The hike in APM gas prices will be a challenge for city gas distribution (CGD) companies. This means that the cost of CNG and piped natural gas will increase for them. Indraprastha Gas Ltd., a company that distributes CNG in Delhi and adjoining areas due to the hike in APM gas prices. (IGL) will have to hike prices drastically over the next one year. A similar step will be taken by MGL, which supplies CNG in Mumbai. will have to be increased by 10-11 per cent.
April 2022 from september 2022 during APM nons prices will increase
According to the trend of international markets, the price of APM gas will increase to $5.93 per unit during April 2022 to September 2022. From October 2022 to March 2023, it will be $ 7.65 per unit. This means that in April 2022, the prices of CNG and PNG will increase by 22-23 percent. In October 2022, the prices will increase by 11-12 percent. The report said MGL and IGL will have to increase prices by 49 to 53 per cent between October 2021 and October 2022 due to the hike in APM gas price.
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