Compressed Natural Gas (CNG) prices may see a rise of Rs.4-6 per kg due to a reduction in input supply and ongoing challenges in the fuel supply chain. This price hike is expected to affect consumers and industries that rely on CNG as a key energy source, including transportation and commercial sectors. The reduced supply of natural gas is putting pressure on costs, leading to an increase in retail CNG prices, which could exacerbate inflationary trends and elevate transportation costs across regions.

Despite the potential price rise, the Indian government is considering measures to ease the situation. A key step under consideration is a reduction in excise duty on CNG to mitigate the financial burden on consumers and help stabilize the market. This move could soften the impact of rising fuel costs and offer some relief in the face of mounting inflationary pressures.

The surge in CNG prices is attributed to disruptions in the natural gas supply chain, which has been impacted by both international and domestic factors. As natural gas is a critical input for CNG production, any changes in its availability directly influence pricing. The situation highlights the vulnerability of the energy sector to supply constraints, especially as India seeks to balance its growing energy demand with fluctuating global prices.

CNG is a cleaner alternative to petrol and diesel, making it a crucial part of India's efforts to promote sustainable transportation. However, continued price hikes may lead to a slowdown in the adoption of CNG vehicles. The government’s response to the situation, particularly its approach to excise duty adjustments, will be critical in determining the extent of the price increase and its impact on the broader economy.