New Delhi, Sep 30 (IANS): The price of compressed natural gas (CNG) in the national capital region will go up by Rs.2.30 per kg from Oct 1, dealing another blow to consumers after the hike in petrol prices.
CNG -- a widely used fuel by commercial vehicles and passenger cars -- will be costlier by Rs.2 and retail at Rs.32 per kg in Delhi, while in Noida, Greater Noida and Ghaziabad it will be dearer by Rs.2.30, making the retail price Rs.35.90 per kg.
The gas retailer Indraprastha Gas Limited (IGL) said it was forced to increase the price as the continuous fall in the rupee had raised cost of importing gas and a fall in domestic production, primarily from the Krishna Godavari (KG) D6 basin, had resulted in increased imports.
"We are constrained to increase the price of CNG due to major increase in the input cost of entire pool of natural gas sourced by us as a result of recent steep appreciation of dollar vis-à-vis rupee and the increased dependence on imported spot R-LNG," said Rajesh Vedvyas, managing director of IGL.
Vedvyas said the company also had to deal with an increase in operational expenses as a result of a hike in power tariff.
The rupee has weakened considerably in the past month and Thursday saw its biggest quarterly fall in three years. It ended Thursday at 48.98 to a dollar.
"With the demand of CNG generally being highest during second half of the financial year and the availability of KG-D6 gas constantly declining, IGL is forced to depend increasingly on costly Spot R-LNG to meet the demand," he added.
IGL, a joint venture of GAIL, Bharat Petroleum Corp and Delhi government, however, said the hike in CNG prices would result in only a minor increase in the running cost of vehicles.
For autos, the increase would be 6 paise per km, for taxi it would be 10 paise per km and in case of buses, the increase would be 57 paise per km.
Despite the prices increase, CNG would still offer over 65 percent savings towards the running cost when compared to petrol-driven vehicles at the current prices and be 22 percent cheaper when compared to those run on diesel.
State-run oil retailers had hiked price of petrol by more than Rs.3 a litre earlier this month citing higher cost of crude and a depreciation in the rupee.