The prices of CNG and PNG are likely to come down. After a recent order of the government, the possibility of a fall in the prices of CNG and PNG has intensified. The Ministry of Petroleum has issued an order to give natural gas supplied to industries to the city gas distributor sector. This has been done so that the common people can get CNG and PNG at a cheaper rate. A 70 percent increase has been seen in the price of CNG used in vehicles and PNG used in kitchens. This has happened because the dependence on imported oil and gases has increased more.
Three months ago, the government approved the use of imported LNG to meet the growing demand for CNG in vehicles and PNG in homes. Imported gas is expensive, but there was no other option as the supply of houses and vehicles had to be met. Now the government has reversed its order of 3 months ago. The earlier order was that only domestically produced gas would be supplied to city gas operators and these operators would not take imported gas. This will lead to a fall in the price because the goods of import become expensive just like that.
what did the government say?
According to an oil ministry official, the supply of city gas operators such as Indraprastha Gas Limited in Delhi and Mahanagar Gas Limited in Mumbai has been increased to 20.78 mmscmd from the earlier 17.5 million standard cubic meters. 94% of the increased supply will be used for CNG in vehicles and PNG in homes. This share of natural gas will be met from the gas made in the country. Earlier, only 83-84 percent of gas was from the country, the rest was done by imported gases of GAIL. Officials say that the use of domestic gas instead of imported oil and gas will reduce the prices of raw materials, this will reduce the cost and the prices of CNG-PNG will fall.
How much inflation in CNG-PNG
The price of CNG and PNG has seen a big increase in the last year as city gas operators have increased their dependence on imported gas. There is an increase of 74% in the price of CNG in Delhi from Rs 43.40 in July 2021 to Rs 75.61 per kg today. The same is the case with the price of PNG. There is also a jump of about 70 percent in the rate of PNG. Earlier, PNG used to get Rs 29.66 per standard cubic meter, which has reached 50.59 per SCM today.
Natural gas is the raw material used to make CNG and PNG. This natural gas is extracted from the basin located in Mumbai High and the Arabian Sea. Then CNG and PNG are made from it. Since the production of natural gas in the country is not enough the supply of CNG and PNG can be continued uninterrupted. That’s why the government imports LNG in ships from abroad. Then CAG and PNG are made from that LNG in plants like GAIL and supplied to the city gas distribution sector. From there the gas is sent to homes and CNG filling stations.
You will get the gas that the industry gets
Now that the prices of LNG and CNG have become equal in comparison to petrol and diesel, the industries have refused to take CNG. Industries use CNG to reduce pollution and operate on cheap gas. There is also pressure from the government that industries should use gas in their furnaces in comparison to oil so that smoke pollution does not spread. But the price of CNG has reached almost equal to oil and there is no capacity of CNG equal to oil, so the government has decided to give gas supply to industries for city distribution. Now gas supply from some of GAIL’s plants and petrochemical units of CNG will be stopped and given to City Distribution. Due to this, a sharp fall in the prices of CNG and PNG can be seen at the domestic level.
