Indian Gas Prices to Decline 17% in April

Natural gas prices in India are likely to decline 17% in April to $3.15 per unit, Press Trust of India reported Monday.

Sources told the news agency that using benchmark prices for the period of January 1, 2015, to December 31, 2015, gas price for the period April 2016 to September 2016 is likely to be about $3.15 per million British thermal unit as against its present price of $3.82.

The Indian government last year approved a new gas price formula under which gas prices are to be determined on a semi-annual basis and calculated based on a volume-weighted average of rates in gas surplus nations of the US, Canada and Russia, based on the twelve-month trailing average price with a lag of three months.

On a net calorific value (CV) basis, the gas price is likely to be $3.50 per million British thermal unit (mmBtu) as compared to the present price of $4.24, Press Trust reported.

Experts believe low gas prices are likely to deter further investment in explorations due to economic unviability.