CNG rate witnesses a dip of 1 rupee; piped gas to cost less from today

In recent developments, the price of compressed natural gas (CNG) will drop by a rupee per kg from Tuesday, October 6.

Moreover, the price of cooking gas or piped natural gas is to drop by 70 paise. The CNG rate will drop from around ₹48.9 per kg to ₹47.9 at city pumps. Moreover, the price of PNG will drop to ₹28.90/unit (slab 1) and ₹34.50/unit (slab 2). As per reports, the drop in the price rates is due to the reduction in the price of domestically produced natural gas by the Centre.

The CNG is a natural gas under pressure which remains clear without smell and is non-corrosive. It can be used as a cheaper, greener, and more efficient alternative to the traditional petrol and diesel fuels for vehicles.

On the other hand, the Centre has long proposed to implement a new floor price mechanism for gas produced from domestic fields by companies such as the Oil and Natural Gas Corporation (ONGC) to prevent the fuel price from crashing below an identified threshold in current subdued market conditions.

As per reports, the Petroleum Ministry has been considering a proposal under which domestic gas will have a floor pricing that would be linked to gas prices with the Japan-Korea Marker, a benchmark index used to determine LNG tariff in North Asia with a discount.