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 CNG prices have risen again in Delhi-NCR. Indraprastha Gas Limited (IGL) has increased the price of CNG by ₹3.89 per kg. The new price will be effective from 6 am on Saturday. After the price increase, CNG in Delhi will increase from ₹83.09 per kg to ₹86.98 per kg. This is the fifth increase in CNG prices this year.

According to IGL, the main reasons for increasing CNG prices are the rising import cost of LNG, rise in international gas prices and increasing demand for CNG.

New prices in NCR cities

After the new price came into effect, CNG in Noida and Ghaziabad has become ₹95.59 per kg. Whereas in Meerut, the price of CNG has become ₹95.47 per kg and in Gurugram, it has become ₹92.01 per kg. The price of CNG varies in different states and cities. A major reason for this is the different VAT rates applicable in different states. IGL says that despite the price increase, CNG in Delhi still remains an economical option compared to other fuels.

Hormuz crisis pushes up LNG prices

According to IGL, the ongoing crisis in West Asia has impacted LNG supply and prices. The disruption of LNG supply and freight through the Strait of Hormuz has led to higher gas prices in the international market.

According to the company, global LNG prices have nearly doubled compared to before the crisis began. Europe’s need to build up gas reserves ahead of winter has also put pressure on international prices.

Rising demand for CNG has led to increased dependence on imports.

Demand for CNG in India is steadily increasing. To meet this demand, a significant portion of the input gas requirement is being met through imported spot LNG. Expensive LNG and rising domestic demand have increased IGL’s input gas costs. In response to these increased costs, the company has increased CNG prices by ₹3.89 per kg.

Auto-taxis and freight transport may become expensive

A large number of autos, taxis, buses, and freight vehicles in Delhi-NCR run on CNG. Therefore, the increased cost of CNG could increase the operating costs of these vehicles.

This could also impact passenger fares and freight costs in the long run. This is likely to have a direct impact on individuals and businesses that rely on CNG-powered vehicles on a daily basis.

LNG prices in Asia more than double

Rising international LNG prices are also impacting Asian benchmarks like JKM. JKM prices rose from around $11 per MMBTU in February of this year to $23.4 per MMBTU in August.

Similarly, Europe’s TTF gas benchmark also saw a rise. Its price rose from around $11.3 per mmbtu in February to $23.3 per mmbtu in August.

Rising gas prices in the international market have also increased the cost of imported gas in India. This impact is now visible on CNG prices.