The increase in CNG prices will affect owners of autos, taxis, buses and goods vehicles in Delhi-NCR.
CNG prices in Delhi-NCR have increased by ₹3.89 per kg. Indraprastha Gas Limited (IGL) said the new prices will come into effect from 6 am on Saturday. Following the hike, CNG in Delhi will rise from ₹83.09 to ₹86.98 per kg. This is the fifth CNG price hike this year.
According to IGL, the main reasons behind the latest increase are the rising import cost of LNG, higher international gas prices and growing demand for CNG. Earlier in May, amid the West Asia conflict and a surge in international energy prices, IGL had increased CNG prices by a total of ₹6 per kg in four phases within 10 days.
CNG at ₹95.59 per kg in Noida-Ghaziabad, ₹92.01 in Gurugram
After the latest hike, CNG will cost ₹95.59 per kg in Noida and Ghaziabad. In Meerut, the price will be ₹95.47 per kg, while in Gurugram it will be ₹92.01 per kg.
Like petrol and diesel, CNG prices also vary across states. One reason for this is the different VAT rates imposed by individual states.
Despite the price hike in Delhi, IGL said CNG remains an economical option for consumers compared with other fuels.
Hormuz crisis hits LNG supply and prices
IGL said the worsening crisis in West Asia has affected LNG supplies and freight movement through the Strait of Hormuz. Global LNG prices have now nearly doubled compared with pre-crisis levels. The need to increase gas storage in Europe ahead of winter has also put further pressure on prices.
Rising CNG demand increases dependence on imports
According to IGL, a large share of the input gas needed to meet India’s growing CNG demand is being sourced from imported spot LNG. Higher LNG prices and rising domestic demand have increased IGL’s input gas costs. To offset the impact, the company has raised CNG prices by ₹3.89 per kg.
Higher costs could affect auto-rickshaws, taxis and freight
A large number of auto-rickshaws, taxis, buses and goods vehicles in Delhi-NCR run on CNG. The higher fuel price could therefore increase their operating costs.
The CNG price hike could eventually affect passenger fares and freight costs. The impact may be greater on people and businesses that rely on CNG-powered vehicles on a daily basis.
LNG benchmark prices in Asia more than doubled
The surge in international LNG prices can be gauged from Asia’s JKM benchmark. Its price was around $11 per MMBTU in February this year, but rose to $23.4 in August.
Europe’s TTF gas benchmark also saw a sharp rise during the same period. It stood at around $11.3 per MMBTU in February and rose to $23.3 in August. The rise in global prices has also increased the cost of imported gas in India.
