CNG price may see `2 hike due to rupee fall
The price of Compressed Natural Gas (CNG) may be hiked by up to `2 per kg in the next few days as rupee devaluation has pushed up input cost.
City gas retailers, including Indraprastha Gas Ltd, which supplies CNG to automobiles and piped cooking gas to households in the capital, are likely to announce fuel price revision over the weekend, sources privy to the development said.
IGL had last raised CNG in Delhi by `2 per kg to `32 per kg on October 1.
Sources said the hike was necessitated because IGL and other gas firms were being forced to buy expensive imported LNG as supplies from Reliance Industries’ eastern offshore KG-D6 gas field have dried-up due to fall in output.
Also, the rupee depreciation has made raw material — that is, natural gas from Reliance, state-owned GAIL and imported LNG — even costlier.
The rupee was valued about `49.50 against a dollar at the time of last price hike and now it is close to `53 to a dollar.
The government has fixed the price of domestic gas produced by state-owned ONGC and RIL in dollar terms and every time the rupee depreciates against the US currency, users end up paying more.
Gas from both Reliance and ONGC is priced at $4.20 per million British thermal units.
The IGL contracted 0.308 million standard cubic metres per day of gas from RIL, but following a 35 per cent drop in KG-D6 output, supplies to city gas projects have been cut so that the demands of the priority power and fertiliser sectors can be met.
Post new comment