Delhi CNG price surges by ₹3.89 per kg amid global LNG cost hikes

Compressed natural gas (CNG) prices in Delhi have risen by ₹3.89 per kilogram, bringing the new retail price to ₹86.98 from ₹83.09, Indraprastha Gas Limited (IGL) announced Friday.

This increase follows a sharp rise in international liquefied natural gas (LNG) prices, exacerbated by the escalating West Asia crisis. IGL stated that the revised prices will be implemented across all areas it serves.

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CNG consumers (private cars, auto and taxi, public transport users and other price-sensitive sections of society) are largely being insulated from the impact of volatile increases in imported spot LNG prices. Amongst gas importing countries like ours, Delhi has one of the lowest CNG retail prices in the World.

IGL noted that Delhi's CNG prices have remained relatively stable compared to global benchmarks. Between late February and August 27, Delhi's CNG retail price increased by approximately 7.8%. In contrast, Europe's TTF gas benchmark rose about 105%, and Asia's JKM LNG benchmark increased by roughly 113% during the same period.

The company emphasized that CNG consumers are largely insulated from the volatile increases in imported spot LNG prices. It claims Delhi has one of the lowest CNG retail prices worldwide among gas-importing nations.

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The increase in international prices has therefore resulted in higher input costs for city gas distributors.

Global LNG prices have nearly doubled since July compared to pre-crisis levels. Disruptions affecting LNG cargo movements through the Strait of Hormuz and increased demand for natural gas storage in Europe ahead of winter are cited as contributing factors to the price pressure.

IGL explained that a significant portion of the gas used for the CNG segment is sourced through imported spot LNG, leading to higher input costs for city gas distributors. The ₹3.89 per kg increase is intended to partially offset these higher costs while ensuring the continuity and reliability of CNG supplies. The company continues to work on optimizing sourcing costs.

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The ₹3.89 per kg increase was necessary to partially offset the higher input gas cost while maintaining continuity and reliability of CNG supplies.