CNG Price Hike: MGL Raises Rates By Rs 2 In Mumbai, PNG By Rs 1 Amid West Asia Crisis

Mumbai: Compressed Natural Gas (CNG) and domestic Piped Natural Gas (PNG) have become costlier in Mumbai and surrounding areas from September 1, with Mahanagar Gas Limited (MGL) raising CNG prices by Rs 2 per kg and domestic PNG rates by Rs 1 per standard cubic metre (SCM).

The revised CNG price in and around Mumbai now stands at Rs 88 per kg. The new rates came into effect from midnight on August 31, or September 1, according to MGL.

MGL attributed the increase to a sharp rise in input gas costs amid the ongoing crisis in the Middle East, which has pushed up international gas prices. The company said prices linked to international indices have increased significantly, affecting the cost of gas supplied to customers.

"In view of the ongoing crisis in the Middle East, which has resulted in a significant increase in input gas prices linked to international indices, MGL has announced a revision in the prices of CNG," the company said in its statement.

Why Has Cng Become More Expensive?

MGL said demand for CNG has increased significantly, while a major portion of the gas required for its CNG segment is being sourced through imported spot Regasified Liquefied Natural Gas (RLNG).

The company said the increase in international gas prices has forced it to source RLNG at higher prices to meet growing CNG demand. This has resulted in a considerable increase in the input cost for the CNG segment and raised the overall cost of gas supplied by MGL.

MGL said the Rs 2 per kg increase will only partially offset the higher input costs. The company added that the revision is necessary to help maintain a steady and sustained supply of CNG to its customers.

13 Lakh CNG Vehicles to Be Affected

The price revision will have a direct impact on a large number of motorists and commercial vehicle operators dependent on MGL's network.

Around 13 lakh CNG vehicles across Mumbai, Thane, Raigad, Ratnagiri, Latur and Dharashiv in Maharashtra, as well as Chitradurga and Davangere in Karnataka, depend on MGL's gas distribution network.

With CNG now costing Rs 88 per kg in and around Mumbai, the increase is expected to raise fuel expenses for private vehicle owners as well as taxis, autorickshaws and other commercial vehicles that rely on CNG.

Domestic PNG Also Gets Costlier

The impact is not limited to motorists. MGL has also increased the price of domestic PNG by Rs 1 per SCM, affecting around 30 lakh domestic consumers.

PNG is widely used by households for cooking, meaning the increase will add to monthly household gas expenses. MGL cited the same rise in input gas costs behind the domestic PNG price revision.

The latest increase comes against the backdrop of heightened volatility in global energy markets as the continuing West Asia crisis affects international gas prices and the cost of imported fuel.

Delhi-NCR Also Saw CNG Price Hike

The MGL increase comes days after Indraprastha Gas Limited (IGL) raised CNG prices in Delhi-NCR and adjoining areas by Rs 3.89 per kg.

Following the revision, CNG in Delhi is priced at Rs 86.98 per kg, with IGL also citing higher input costs linked to imported LNG.

The successive revisions by city gas distributors highlight the impact that higher international gas costs are having on domestic CNG prices.

For Mumbai consumers, the latest MGL revision means higher fuel costs for CNG vehicle owners and increased household expenses for PNG users from September 1.

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