Domestic Natural Gas Price for April to be $7.92, Rate For Consumers Capped At $6.5

The energy ministry said on Friday that the domestic natural gas price for the remainder of April will be $6.5 per mmbtu. After the Cabinet's Thursday acceptance of a new price structure for gas generated by ONGC and Oil India from their so-called nomination fields, the new rate is already in effect. Every month, a new petrol price will be determined and will be equal to 10% of the monthly average price of Indian basket crude. According to this calculation, the price of petrol will be $7.92 per mmbtu from Saturday through the end of April.

The report quoted a directive from the Petroleum Planning and Analysis Unit of the Oil Ministry (PPAC). The PPAC estimates that the price of natural gas will be $7.92 per million British thermal units from 8 April to 30 April under the new indexation that will price it at 10% of the cost of imported crude oil. The pricing mechanism, however, sets a limit on consumer prices at $6.5 per million BTUs.

The price shall be subject to a ceiling of USD 6.5 per mmBtu for the gas generated by ONGC/OIL from their nominated fields, the ruling stated. Nonetheless, the new standard sets the price of petrol at a $4 minimum and a $6.5 maximum per mmbtu. As a result, the government stated that the actual price will be $6.5 per mmBtu. Since this is significantly less expensive than the March price of $8.57 per mmbtu, city gas firms will be able to lower their prices for the gas they sell for use in transportation and cooking.

The new price is $9.16 per mmbtu for the period from April 1 to 7. The 2014 government pricing guideline, which has been replaced by the current guideline, served as the basis for this. The ministry has not altered the price as of April 1 since it was seeking Cabinet approval for its new pricing structure. Prices were updated every April and October under the 2014 guideline.