look news india
CNG Price : If you get the news of CNG becoming expensive in the coming days, then be surprised and also know the reason. The central government has reduced the supply of cheap domestic CNG to urban retailers by 20 percent. After this, the price of domestically produced CNG may increase by Rs 4 to Rs 6 per kg.
The government has cut supplies to retailers from October 16. Under this, the total demand for CNG came down to only 50.75 percent which was 67.74 percent last month. This means that the government has reduced the supply of natural gas to retailers. Gas prices are likely to increase due to reduced supply.
Why will city retail gas prices increase?
Sources said the prices of produce from old farms are controlled and manipulated by the government. Annual production from these places is decreasing by five percent. Due to this, the supply to urban gas distribution companies has been cut off. Retail buyers of natural gas will be forced to buy imported and expensive LNG to meet the shortage, which could push CNG prices up by Rs 4-6 per kg.
There is a big difference in the prices of imported gas
Gas from old fields is priced at US$6.50 per million British thermal units (MMMBtu), while imported LNG is priced at US$11-12 per unit. In May 2023, 90 percent of the demand for CNG was being met by gas found in old fields, but it is continuously declining.
Sources said the government has cut the supply of raw material for CNG as the gas supplied to homes is reserved for cooking.
What options does the government have to save CNG from becoming expensive?
Information has been received from sources that at present the retail gas sellers have not increased the prices of CNG, because they are currently in talks with the Ministry of Petroleum and Natural Gas to find some other way for this. Sources say that after this decision of the government, if the excise duty on fuel is not reduced, then the common customers may have to bear the burden.
One option is that the government can reduce the excise duty on CNG. At present, the central government imposes 14 percent excise duty on CNG, which in rupee terms works out to Rs 14-15 per kilogram. If it is reduced then retail gas sellers will not have to pass the burden of increased prices on customers.
If CNG becomes expensive then there will be a shock before the elections!
Elections are to be held in Maharashtra next month and elections are to be held in Delhi soon and Delhi-Mumbai is one of the largest CNG markets in the country. At such a time, if the government makes arrangements to make CNG expensive, then it can become a big issue.