Mahanagar Gas has recently increased the retail price of compressed natural gas (CNG) and piped natural gas (PNG) in Mumbai, it announced on Wednesday. The retail rate of CNG will jump Rs 4 per kilogram to Rs 80 while rate of domestic PNG will increase by Rs 3 per standard cubic metre to Rs 48.50, in and around Mumbai. The new retail prices of CNG and PNG will be effective from July 13 midnight. Surging input costs and plunging rupee have pushed the prices of CNG and PNG, said the distributor.
“Mahanagar Gas Limited (MGL) has always tried to maintain price stability for its customers. However, since the increase in input gas cost is significantly high, MGL has decided to recover such increased gas cost. Accordingly, MGL is constrained to increase the MRP of Compressed Natural Gas (CNG) by Rs 4.00/Kg and Domestic PNG by Rs 3.00/ SCM in and around Mumbai,” said MGL in a statement.
The central government had increased the price of domestic and imported natural gas by over 110 per cent from April 1. That time, too, the MGL had increased the price of CNG and PNG. The distributor has now that the falling rupee along with the surging input costs were the reasons behind hiking CNG and PNG prices from July 13.
This is the 10th time that CNG prices have been hiked in the past year, with its rates increasing by as much as Rs 30 per kg between July 2021 and July 2022.
The Centre had increased the price of domestic and imported natural gas by over 110 per cent from April 1. This had completely offset the steep price reduction announced by the state by way slashing tax (VAT) on these fuels to 3.5 per cent from 13.5 per cent from April 1.
“The selling price of domestically produced Natural Gas was increased by 110 per cent by the Government of India with effect from 01st April 2022. Further, cost of Re-gasified LNG which is being blended to offset the shortfall in availability of domestic gas for CNG and D-PNG segments, are at historically high levels. This combination has resulted in a significant increase in the cost of gas being procured by MGL,” the distributor had said at the time of increasing the prices last time on April 30.
“Being a customer focused Company, MGL has always tried to maintain price stability for its customers. However, since the increase in input gas price is significantly high, MGL has decided to progressively recover such increased gas cost,” it had said at the time.
Despite liberalising the energy sector, the government still controls both price and supply of natural gas to a large extent. Prices and supply allocation are decided in advance twice a year. The CNG price hike today came even as the prices of international crude oil cooled down to scale below $100 per barrel on Wednesday.
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