CNG cylinder of truck blasts during gas filling, one injured
A 45-year-old man received minor injuries after a CNG tank of a truck blasted during gas filling at a petrol pump in South-West Delhi’s Najafgarh, police said on Wednesday.
After the crude oil surge, global gas prices are expected to soar this year, putting consumers in India at the risk of inflated CNG and PNG rates.
As per an assessment of the gas market done by Kotak Institutional Equities (KIE), domestic gas price are expected to more than double to $6.6-7.6/million BTU in 1HFY23E from the current level of $3.2/million BTU available during 2HFY22.
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“We compute a steep increase in domestic gas price to US$6.6-7.6/mn BTU for 1HFY23E, driven by the recent steep increase in global gas prices and anticipated higher futures curve in the coming months,” KIE said in its report.
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Benchmark gas prices have increased further in September 2021- with Henry Hub gas price increasing to $5.1/mn BTU from $4.1/mn BTU in August ($2.6/mn BTU used in the calculation for 2HFY22 prices), and UK NBP jumping to 15.4 pounds/mn BTU from 10.9 pounds/mn BTU in August (5.9 pounds/mn BTU used in the calculation for 2HFY22 prices).
Moreover, Alberta hub gas price also increased to $3.1/mn BTU from $2.8/mn BTU in August ($2/mn BTU used in the calculation for 2HFY22 prices).
Asian spot LNG prices increased further to $22.8/mn BTU from $16.7/mn BTU in the previous month.
Higher gas prices means higher cost of transportation and cooking fuel for consumers. While the CNG margins are steady in September, a price hike of Rs 5-7/kg is required to pass on gas cost.
IGL had undertaken a price hike on August 30 to mitigate higher cost of incremental LNG that it had to use for its CNG segment given capping of domestic gas allocation at 110 per cent of CNG consumption in 2HFY21.
“We note that IGL and MGL will be required to take price hikes of around Rs 5-7/kg to pass on the impact of higher domestic gas price in 2HFY22,” KIE said.
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