Nearly Rs 4/kg CNG hike hits Delhi-NCR from Saturday morning

CNG users in Delhi and neighbouring cities will have to pay more from Saturday morning, with Indraprastha Gas Limited (IGL) announcing a hike of Rs 3.89 per kg.

The revised rates will come into effect from 6 am on August 29. In Delhi, CNG will now cost Rs 86.98 per kg, compared with the existing price of Rs 83.09.

The increase is expected to affect a large number of motorists, as well as auto-rickshaw, cab and other commercial vehicle operators who rely on CNG across the Delhi-NCR region.

Why has CNG become more expensive?

IGL attributed the price revision to a sharp increase in international liquefied natural gas (LNG) prices. The company said a substantial portion of the gas used for CNG comes from imported LNG, making domestic prices vulnerable to movements in international markets.

Spot LNG prices have risen significantly amid the ongoing conflict in West Asia, increasing the cost of the gas supplied to the CNG network.

“With international LNG prices remaining elevated and the cost impact becoming increasingly significant, a calibrated revision of Rs 3.89 per kg has now become necessary to partially offset the increase in input gas cost," IGL said.

Second hike this year

Saturday’s increase comes after IGL raised CNG prices by Rs 1 per kg on May 17.

The latest revision is considerably larger and comes at a time when energy markets are facing pressure from geopolitical tensions and disruptions around the Strait of Hormuz, an important route for global oil shipments.

Impact of higher global energy costs

International crude and gas prices have climbed as the Iran conflict has disrupted energy flows and heightened concerns over supplies. The rise in imported gas costs is now feeding into CNG prices in the national capital region.

Retail fuel prices in India had remained relatively stable for several months despite fluctuations in global energy markets. The latest CNG hike reflects the increasing pressure faced by gas suppliers as international LNG prices remain elevated.