CGD companies buoyed by CNG price differentials: Should normative pricing norms be adopted?
Aug 30: The sharp and rising price differential between CNG and its competing fuels such as petrol and diesel is likely to buoy margins of city gas distribution companies in the months ahead 8Government policies allow the CNG segment an assured domestic gas supply. 8Then again, CNG is cheaper by nearly 50% as compared to petrol and 30% in relation to diesel. 8More efficient turnaround time at filling stations and a higher rate of conversion of private vehicles are likely to keep volumes up going ahead. 8But the question is why is the government following two different pricing regime, one for gas which based on well head prices across the world, and another, for petrol and diesel, indexed to crude oil, to compete in the marketplace without adequate regulations? 8Has a time come to impose price caps on CNG given the highly subsidized gas is made available to this segment? Click on Reports for more