Adani Total Gas hikes CNG prices by ₹4 per kg as LNG costs surge

Adani Total Gas Ltd (ATGL) has raised compressed natural gas (CNG) prices by ₹4 per kg across its geographical areas, effective August 1, according to The Hindu BusinessLine. The revision — driven by reduced domestic gas availability and elevated global LNG prices amid geopolitical tensions — takes CNG in Ahmedabad to ₹94.02 per kg, inclusive of all taxes, marking one of the steepest revisions in recent months.

Company cites higher gas sourcing costs

"The revision in CNG prices has been necessitated by a significant increase in natural gas sourcing costs arising from reduced availability of domestic gas, supply curtailments, and elevated global gas prices due to geopolitical issues," an ATGL spokesperson told The Hindu BusinessLine. The spokesperson added that despite these challenges, ATGL continues to make every effort to minimise the impact on consumers while ensuring uninterrupted supply of CNG, which remains an economical and environmentally friendly fuel option.

LNG volatility and the Strait of Hormuz

According to the company, global LNG markets have witnessed exceptional volatility over the past six months. LNG prices, which were in the $10–13 per MMBTU range in February, surged after the outbreak of conflict in the Middle East disrupted shipments through the Strait of Hormuz — a critical export route for Qatar and the UAE, which together accounted for nearly 59% of India's LNG imports in 2025. Benchmark spot prices, including the Japan-Korea Marker (JKM) and the West India Marker (WIM), climbed to around $25 per MMBTU in early March before easing during April and June. However, prices remained well above pre-conflict levels and rose again to $19–22 per MMBTU in July amid renewed regional tensions and continued disruption to Hormuz transit.

Domestic gas shortages add to pricing pressure

The rise in imported LNG prices has coincided with lower availability of domestically produced natural gas, forcing city gas distribution companies to procure imported fuel at a higher cost. While the government allocates domestic gas to city gas distributors for priority segments such as CNG and piped natural gas (PNG), any reduction in these allocations raises procurement costs and puts pressure on retail pricing, according to The Hindu BusinessLine.

CNG demand stays resilient despite price hike

Despite the increase, demand for CNG has remained robust. During the June quarter, ATGL reported an 18% year-on-year increase in CNG sales volume to 218 million standard cubic metres (MMSCM), while overall gas sales volumes rose 13% to 303 MMSCM, driven by network expansion and higher throughput across multiple geographical areas. The company currently operates across 53 geographical areas spanning 125 districts in 18 states and three Union Territories, with a combined network of 1,167 CNG stations, including joint ventures. Six new CNG stations were added during the June quarter.

Price gap widens between ATGL and GEL

The latest hike has widened the price gap with state-run Gujarat Energy Ltd (GEL), which retails CNG at ₹85.01 per kg in its operating areas. Gujarat-based ATGL dealers, speaking on condition of anonymity, said ATGL has raised CNG prices for the fifth time since April 2026, when the price stood at ₹81.36 per kilogram.

Sources: