Mahanagar Gas Ltd (MGL), the company responsible for supplying CNG to automobiles and piped natural gas (PNG) to households in Mumbai and neighboring cities, has announced a price hike for both fuels. Effective from the intervening night of July 8 and 9, CNG prices will increase by Rs 1.50 per kg, while PNG rates will go up by Re 1.
The company attributed the price hike to rising input costs, citing an increase in demand for both CNG and PNG coupled with a shortfall in domestic gas allocation. To meet the growing demand, MGL has been forced to source additional natural gas from the market, particularly imported LNG, which comes at a higher price.
The revised prices, inclusive of all taxes, will see CNG in Mumbai priced at Rs 75 per kg and domestic PNG at Rs 48 per scm.
This price increase comes after a similar move by Indraprastha Gas Ltd (IGL) on June 22, which raised CNG prices in Delhi by Re 1 per kg to Rs 75.09. However, IGL maintained the PNG rate at Rs 48.59 per scm.
Despite the price increase, MGL emphasizes that their CNG remains an attractive option, offering savings of about 50% and 17% compared to petrol and diesel respectively at current Mumbai prices. They also highlight the continued convenience, safety, reliability, and environmental friendliness of their domestic PNG. Furthermore, MGL claims that even after the recent adjustments, their CNG and PNG prices remain among the lowest in the country.
The rise in prices underscores the growing challenge of meeting India’s escalating demand for natural gas. While CNG and PNG are increasingly popular options due to their environmental benefits, the supply of domestically produced natural gas has struggled to keep pace. ONGC, the state-owned oil and gas corporation, currently supplies around 66-67% of the CNG demand in India, with the remaining portion being met through imports. This reliance on imported LNG contributes to the fluctuating price of natural gas and presents a challenge for maintaining affordable energy options in the country.
