CNG to cost more after govt hikes APM gas price by 4%

The government on March 31, 2025, raised by 4% the price of natural gas produced from old legacy fields called APM - the key input used to make CNG and produce electricity and product fertiliser.

The government on Monday (March 31, 2025) raised by 4% the price of natural gas produced from old legacy fields called APM - the key input used to make CNG and produce electricity and product fertiliser.

The APM price has been hiked to $6.75 per million British thermal units effective April 1 from $6.50 per MMBtu, a notification of the Petroleum Planning and Analysis wing of the Oil Ministry said.

APM gas is produced by state-owned firms Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) from fields that were given to them on a nomination basis. This gas is the input that is used in the cooking gas piped to household kitchens as well as turned into CNG for running automobiles, making fertilisers and producing electricity.

This is the first increase in the APM gas price in two years and in accordance with the roadmap that was laid out by the government.

In April 2023, the Union Cabinet accepted an expert committee report to price the bulk of domestically produced natural gas at 10% of the monthly average import price of crude oil with a floor of $4 per million British thermal unit and a cap of $6.5.

In doing so, the government had tinkered with the recommendation of a $0.50 per mmBtu annual increase till full deregulation in 2027. The Cabinet decided that rates will not change for two years and will be increased by $0.25 annually thereafter.

The hike announced on Monday is in line with that decision.