Delhi Drivers Face Fresh CNG Burden As Rs 3.89 Increase Pushes Prices Close To Rs 87 Per Kg

Compressed natural gas (CNG) prices in Delhi-NCR have increased by Rs 3.89 per kg, taking the retail price to Rs 86.98 per kg from Friday. Indraprastha Gas Limited (IGL), which supplies CNG across the Delhi-NCR region, attributed the increase to rising input gas costs, particularly elevated international liquefied natural gas (LNG) prices. The increase is expected to affect a large number of commuters and commercial transport operators who rely on CNG. IGL said the price revision had become necessary because international LNG prices remained elevated and their impact on the company's input costs had become increasingly significant. The company described the increase as a calibrated revision intended to partially offset higher gas procurement costs while maintaining the continuity and reliability of CNG supplies.

The revised Delhi price of Rs 86.98 per kg will apply from Friday. The company said CNG remains among the more economical fuel options available to consumers in Delhi even after the latest increase. IGL noted that its customers include private vehicle owners, auto-rickshaw and taxi operators, public transport users and other price-sensitive sections of society. The company said these consumers have largely been insulated from the sharper volatility seen in imported spot LNG prices, despite the recent increase in international energy costs. IGL specifically cited the re-escalation of the West Asia crisis and its impact on cargo movements through the Strait of Hormuz as a major factor behind the increase in global LNG prices.

According to the company, international LNG prices have nearly doubled compared with levels before the crisis. The disruption and uncertainty surrounding one of the world's most important energy shipping routes have increased pressure on international gas markets, raising procurement costs for countries and companies dependent on imported supplies. The company also pointed to increasing demand for natural gas in Europe ahead of the winter season. European countries are seeking to increase gas storage levels before colder weather arrives, potentially adding further pressure to global LNG supplies and prices.

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IGL said these international market developments have coincided with a significant increase in CNG consumption in India, driven by economic growth and rising consumer demand. To meet the growing demand for CNG, a significant portion of the gas supplied to the CNG segment is being sourced through imported spot LNG, according to IGL. The company said the combination of higher international LNG prices, increased demand and the need to secure adequate supplies has resulted in a considerable rise in the input cost of gas used for CNG. The latest increase is likely to be particularly relevant for commercial users such as auto-rickshaw drivers, taxi operators and public transport services, for whom fuel costs form a significant component of operating expenses.

Private motorists who have switched to CNG to reduce fuel expenditure will also face higher running costs. However, IGL maintained that CNG continues to be a comparatively economical fuel option in Delhi even after the revision. The price hike highlights how developments in international energy markets can directly affect domestic fuel costs. While IGL said the Rs 3.89-per-kg increase was necessary to partially offset higher input costs, the company stressed that it was also seeking to maintain reliable CNG supplies amid rising consumption. With global LNG prices remaining sensitive to geopolitical developments and seasonal demand, further changes in input costs could continue to influence the economics of CNG distribution in the region.

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